Presented by David Cole Background to Chip

PAYMENT SYSTEMS HISTORY A POTTED HISTORY DINERS LAUNCH 1950 AMEX LAUNCH 1958 BANK AMERICARD 1959 MASTERCHARGE 1962 ACCESS CARD LAUNCH 1971 FIRST EMV TRANSACTION 1997

IMPORTANT MILESTONES FIRST ATM 1967 FIRST ICC PATENT 1968 MAGNETIC STRIPE 1969 DEBIT CARDS 1988 SMART CARDS 1995

What is a Smart Card It’s a PC Its programmable It’s in the Wallet

Smart Card v’s the IBM PC Expensive No software No future

Original Concepts Arikito Japan 1968 Rolf Merano France 1974 Slow to Start A solution looking for a problem French Telecom & Banks Now really starting to move

Magnetic Stripe V’s Smart Card Magnetic Stripe Cheap Worldwide Investment Established Standard Chip Expensive Emerging infrastructure Emerging Standards

Magnetic Stripe V’s Smart Card Magnetic Stripe Towards the end of its life Poor Security Easy to Attack Limit Functionality Chip At the start of its cycle of potential Secure Hard to Attack - A trusted secure environment The functionality of a computer

Why Chip Now Fraud has been the main driver Magnetic stripe was weak, limited and under attack Chip is stronger, at the start of its development cycle and it’s a computer. 9

Why EMV In the early 1990’s fraud was rising steeply, mainly counterfeit fraud. Visa and MasterCard where picking up most of the fraud losses Three leading countries UK, Brazil and Japan UK Government got involved UK Banking Association where experimenting with an early EMV All the old actions failed to affect the rise in fraud UK government decided / enforced to use chip cards – UKIS Adopted by Visa and became – VIS EuroPay (MasterCard) joined in – EMV

What is EMV The international standard for chip based credit, debit or charge card. or

What is EMV The single biggest and most expensive upgrade to cards and payments ever.

What Else is EMV Its and application not a card Mandated by the card schemes for: Acquirers - now Issuers – this will come The basic infrastructure for smart card solutions It’s a long drawn out migration

Infrastructure This is what the whole EMV project is about at this time. To get interoperability around the world we have to upgrade all: Terminals ATMs Card Schemes Front end systems Back end systems Any other affected system