Qatar Central Bank with the support of Visa International organised an EMV forum in Doha today for the Qatari banks to go through all their requirements and address any concerns about the migration of liability for losses incurred through certain fraudulent transactions. Effective 1st January 2006 the liability for fraud will transfer as appropriate to the card issuers, or acquirers, who are the banks which issue charge and credit cards to their customers, if they do not support chip cards and if the use of chip would have prevented the loss.
In his opening speech, Mr. Abdel Hadi Ahen, Banking Electronic Systems Manager, Qatar Central Bank, explained: "At present, losses due to fraudulent transactions are the responsibility of the card issuer. When the changes come into effect in Qatar at the end of this year, Visa's Chip Liability Shift takes place. Chip cards issued with PIN preferring Card Holder Verification Method will protect the issuer from liability shift. The new rule does not affect the person in whose name the card is issued."
The change in liability comes about with the progress of a process called EMV Migration. EMV is a set of standards for implementing payments made via chip cards that was developed jointly in 1997 between Europay, MasterCard and Visa – hence the name EMV - and established as a single company to manage and police the EMV standard.
Continuing his explanation of liability shift, Mr. Ahen added: "Issuers who have not migrated to EMV will be liable for fraud at EMV devices. Acquirers who have not placed EMV terminals with Pen Entry Devices (PED) will be liable for all fraud on chip cards, including transactions authorised online by the issuer."
Since the original launch of EMV, the technology on how to implement the standards has evolved. New versions of EMV standards have been developed, these are called Common Core Definition (CCD) and Common Payment Application (CPA). Together, these new versions simplify matters and provide greater benefits, especially to those members who handle products from different card schemes.
Representing Visa International, Mr. Ramesh Chandnani New Technology Manager, said that: "Basically, before either acquiring chip transactions or issuing chip cards, the individual banks and processors must have their systems and terminals upgraded or replaced with EMV capable systems and terminals. All system and terminal vendors that are participating in EMV have had their products tested and certified by EMVCo and should provide prospective clients with EMVCo certifications for all compliant systems and/or terminals."
Mr. Chandnani went on to say that: “Visa contributes global expertise in chip migration and provides proactive support to member banks considering migrating to chip. The in-depth experience and dedication of the project management team at Visa ensure timely and efficient completion of certification. “
At the EMV Forum, Visa International thanked Qatar Central Bank for their proactive approach to EMV, especially in the light of an anticipated increase in card usage due to next year's Asian Games.
Smart technology is the wave of the future for all charge and credit card payments and chip is an advanced technological security feature that has been developed to provide safer transactions for the benefit of all parties involved, namely the card issuers, the card acquirers and the card users.
