Visa chip cards: They’re not everywhere the company wants them to be. But…they might be getting there.
Wednesday, payments industry watchers got a few more data points, in addition to the plethora already released on the very eve of the transition to EMV, that like so many data points, offer grist for the mills of supporters and opponents of any industry sea change.
In a conference call Wednesday (Sept. 30) afternoon, Visa executives gave forth a few numbers. As of Sept. 15, the payments giant said, the company had 151.8 million chip-enabled cards in the U.S. market, a good jump over the 20 million chip cards that had been in the trenches at the end of August last year. That’s a bit more than 20 percent of all Visa debit and credit cards in the nation, and a result strong enough for Stephanie Ericksen, who heads the risk products division at Visa, to declare on the call that there’s been a “huge amount of momentum” in card uptake.
But the cards themselves are useful only if they can be used at a terminal, and here, on the merchant side, is where the momentum may be a little slower. At mid-month, more than 314,000 merchant locations across the country were able to process the chip cards, and that’s up from an installed base of 55,000 from September of last year.
Good growth, but obviously there is work to do. Keep in mind, however, that for Visa, each one of those 314,000 locations does not represent a single terminal point, as at many locations (such as big-box retailers, an example mentioned specifically during question and answer yesterday), there can be dozens of terminals installed. There’s comparatively longer runway in overhauling the infrastructure and the numbers illustrate that merchants may be more akin to lumbering 747s than jets when it comes to clearing that runway and catching air.
[bctt tweet=”Visa’s chip card data shows good growth, but obviously there is work to do.”]
Still, the Payments Security Task Force gave an update Wednesday that projected that about 60 percent of cards from the top issuers will be moved to chip status in the U.S. by the end of this year, and will reach 98 percent by the end of 2017. Percentage projections aside, the countries outside the U.S. that took their own plunge into EMV saw varying rates of speed dependent on self-policed movements by merchants and retailers or by government mandate.
And there was a bit more data served up yesterday. A survey of the Task Force’s eight member financial institutions showed that at the end of June (which, admittedly does not square evenly with the Visa data from this week), 30 percent of consumer debit and credit cards in the nation have EMV chips. That’s somewhat of a tell on transaction volume to come as EMV finally, officially rolls out (perhaps you’ve heard there’s a deadline today?) represent about 50 percent of payment card volume across the U.S.
Interestingly, even as the technology moves along to determine what is in place for payments, Visa took some time to discuss the how of payments themselves. Amid growing traction in EMV, Visa said yesterday that PINS and signatures may not be the defining security standards indefinitely (and yes, biometrics made a brief entry into the discussion, from Mark Nelsen, Visa’s SVP of risk products and business intelligence).
Visa executives said Wednesday that more than 60 percent of transactions take place with no signature, and through contactless means – a trend that will grow, marked by retail-driven transactions of as much as $25, and even more depending on the goods being bought. Visa’s Ericksen noted that in a few other countries, contactless payments of as much as $100 do not require a PIN, and in what seems a vote of confidence, the United Kingdom boosted its “PIN-less” limit on contactless payments to £30 from £20.