The ATM Industry Association urged MasterCard last week to support a U.S. debit solution accessible to all networks after the card company said earlier this month that it planned to stick to its EMV shift deadline.
MasterCard said earlier this month it would keep to its October 2015 deadline, though the industry has not yet reached an agreement on how to route debit transactions through the EMV system.
Under MasterCard’s current plan, the EMV shift would be October 2016 for the ATM industry. MasterCard and other card networks have established a “liability shift,” which is designed to encouraged merchants to make the migration to EMV.
In its Jan. 8 open letter, MasterCard said a delay in the liability shift dates could “potentially increase the U.S.’ disproportionate share of the world’s fraud losses.” ATMIA said, however, that the liability shift is only useful if the payments industry can reach agreement on a debit-routing solution for the EMV migration.
“A liability shift date only serves as an incentive (albeit a negative one) if those subject to it have reasonable and timely access they need for a complete deployment of EMV-capable terminals,” ATMIA USA Executive Director David Tente said. “If wide-spread implementation by ATM acquirers and others is inhibited due to the lack of a generally acceptable debit solution, a liability shift has no impact on the level of fraud. It merely shifts those fraud losses from the issuer to the acquirer.”
ATMIA lauded a solution proposed by the Debit Network Alliance last year that would provide flexibility in implementation.
“It appears likely that the DNA solution could adapt easily to any changes that may come in the wake of federal appeals court decisions on the Federal Reserve Board implementation of Durbin rules,” the Mastercard letter said. “In conjunction with its announcement on liability shifts, MasterCard has a unique opportunity to take a leadership position here that would truly be of service to the industry—by joining the DNA.”
Tente said MasterCard’s support of the DNA initiative “could be the breakthrough needed to accelerate progress toward EMV migration in the debit space.”