Payments Next Big Thing: DCV

Now that EMV is officially in place, it has brought to light the growing need to be proactive when it comes to security and begs the question: What’s next?

In a white paper titled “EMV and Beyond,” Gemalto posits that there are additional considerations for banks faced with tackling the next “weak link” in payment and banking security.

For EMV, most banks, at this point, have made decisions regarding card profiles or whether procedures will be tied to chip-and-signature or chip-and-PIN. The numbers show strong growth for EMV adoption in the U.S.: As many as 575 million cards will be in circulation by the end of this year, which is on top of the 185 million cards and modules that were issued in 2014. This can be broken down into a rough estimate of 1.6 million EMV cards issued on a daily basis.

EMV has set the stage for security, as well as innovation, in payments. Yet, the question now becomes whether adding contactless makes sense from both a business and consumer perspective. Contactless EMV, Gemalto believes, will enable faster, secure payments through a mobile, card or wearable device — which not only helps get consumers over the “dip-and-wait” EMV hurdle but allows them to choose the form factor that enables their payment choice.

But the buck, as the saying goes, shouldn’t stop there. It’s time to consider the security aspects that move beyond physical credit and debit cards to the CNP space.

And that, says Gemalto, can come in the form of EMV credit and debit cards that have a dynamic code verification (DCV) for online payments. The dynamic security code changes automatically every 20 minutes for an additional layer of protection. Known as “intelligent” payment cards, they contain small ePaper screens that are built into card bodies themselves and tie into time-sensitive or transaction-based codes. That means they cannot be reused for card-not-present transactions or duplicated. And because the technology is built directly into the payment card, using those cards does not require any behavioral change on the part of the consumer.

Another option comes with tokenization. The use of that technology, according to the white paper, ensures some measure of defense against cross-channel fraud, including, and especially, CNP fraud. There are other boons from tokenization, and among them, there’s simplified enrollment through what Gemalto calls “a trusted service hub.”

“This enables over-the-air, streamlined onboarding of new customers and allows for quick and easy addition of multiple card profiles to a user’s account,” Gemalto states in the white paper.

To download the full white paper, please click the button below.