E-Financial
Over 5% Card Issuers Will Suffer Fraud on EMV Cards In 2015- Gartner
Analyst at Gartner have revealed that following some high-profile data breaches in 2014, U.S. payment card network participants began heavily endorsing Europay, MasterCard and Visa (EMV) chip cards as an important way to prevent damage from payment card breaches.
Avivah Litan, vice president and distinguished analyst at Gartner, believes that criminals have taken advantage of poor implementations of EMV chip payment applications, committing extensive fraud that defeats EMV controls for everyone in the payment card ecosystem.
In her research note, “Avoid Pitfalls with Payment Card Security Technologies and PCI,” Litan, points out some of the hidden problems with payment card security technologies and the payment card industry (PCI). By year-end 2015, at least 5 percent of card issuers will suffer fraud on EMV cards due to improper implentations, up from a handful today.
In a blog post, Ms. Litan shared some of the findings from her report.
Ms. Litan said: “EMV chip cards, already adopted in the rest of the world, have proven to dramatically reduce counterfeit card fraud because they are significantly harder to clone than magnetic stripe (magstripe) cards, which are still used throughout the U.S. Nevertheless, the adoption of EMV is relatively slow and as a result, payment card network participants must prepare for at least five more years of support for EMV chip as well as magstripe protocols on a single payment card.
“Card data breaches have pushed U.S. banks, card networks, mega-retailers and other payment card acceptors into more aggressively adopting two further key security technologies in addition to EMV cards – tokenization and point-to-point encryption (P2PE).
“Although these three security technologies have been around for years, interest in them soared after the breaches, and many enterprises have developed much more aggressive implementation timetables than they would have otherwise”.
She said, however, in the march to rollout these enhanced security systems some vulnerabilities and conflicts have surfaced.
“This calls out the need for all players in the payment ecosystem to work together on open security standards, streamlined certification processes and shared education on best implementation practices”.
EMV tokens, as first implemented by Apple Pay and the payment card networks, are based on different protocols than the tokenization systems merchants use to limit the scope of PCI audits, leading to potentially conflicting token implementations.
Merchants who use their own tokenization system, and also accept Apple Pay or other EMV token payments, will end up with multiple tokens for one card number, defeating a major reason why many merchants adopted tokenization in the first place.
As far as point-to-point encryption (P2PE) is concerned, P2PE can usually be turned on within 3 months if the solution uses remote key injection and management.
Physically injecting keys into each card reader in a “safe room” under its own “lock and key” obviously takes much longer. Once deployed, P2PE can help protect all card transactions against data breaches. Retailers we regularly speak with say they will turn on EMV acceptance “later”.
They rightfully view EMV as mainly helping the card brands and issuers, although when EMV becomes ubiquitous it will help everyone.
Titan Trust Bank has selected Oracle FSS for its core and digital banking technology, it is understood.
The start-up bank recently obtained its license by the Central Bank of Nigeria (CBN).
It’s understood that Temenos and Infosys also competed for the deal.
The shortlist came down to the two most widely installed international core systems in Nigeria, Infosys’ Finacle and Oracle FSS’s Flexcube.
The Nigerian banking sector has seen a great deal of upheaval over the years, with many mergers, start-ups and closures. Flexcube is a well respected name since the late 1990s (the pioneer was Access Bank, now one of the country’s top five banks) and has been a commonly selected platform since then.
The new bank is believed to be one of five to have gained regulatory approval of late (Globus Bank is another).
Local media sources say the new licences stem from the Central Bank’s desire to attract new investments into the sector and better serve the country’s 50 million+ unbanked and under-banked citizens.
Titan Bank is said to be headed by a former executive director of Heritage Bank (which is a Finacle user).
Oracle FSS did not respond to request for comment.
International Monetary Fund (IMF), has appointed Tony Elumelu, Nigerian billionaire and group chairman of Heirs Holdings, owners of United Bank of Africa, to its advisory council on entrepreneurship and growth, convened by Kristalina Georgieva, the fund managing director.
The announcement was disclosed in a statement on Friday.
According to the statement, the IMF advisory council comprises global business leaders, policymakers, and academics dedicated to identifying and addressing regulatory barriers to entrepreneurship.
The IMF said Elumelu will be instrumental in ensuring that Africa’s entrepreneurship is central in policy making.
“Elumelu, Africa’s leading advocate of entrepreneurship and whose Foundation has funded, mentored, and trained over 25,000 African entrepreneurs since 2015, champions entrepreneurship as the engine for the economic transformation of Africa,” the statement reads.
“A self-made entrepreneur, Elumelu’s embracing of entrepreneurship is fundamental to his concept of Africapitalism, his belief that Africa’s private sector can and must play a leading role in the continent’s development, making long-term investments that deliver social and economic value.
“Elumelu will be instrumental in ensuring that Africa’s entrepreneurial potential is central to global economic policy making.”
Speaking at the inaugural meeting of the advisory council on March 26, Georgieva said the appointees would share their experiences on how macroeconomic and financial policies “can provide a supportive environment for innovation, entrepreneurship, and productivity — key ingredients for a thriving private sector and strong economic growth”.
Africa’s Micro, Small, and Medium Enterprises, fintech industry, scaling remittances, and cross-border payments will be the driving forces behind the continent’s digital ballooning payments system, which is estimated to reach $1.5 trillion by 2030.
This is according to a MasterCard-commissioned study by Genesis Analytics, which states that the digital payments economy is growing faster on the continent.
This comes as the World Bank says Sub-Saharan Africa has shown significant growth in financial inclusion over the past decade, much of it driven by mobile money account adoption.
Dimitrios Dosis, president, Eastern Europe, Middle East and Africa at MasterCard, comments: “Africa is filled with immense possibilities, and its people have the potential to shape the global economy in the decades ahead.
“MasterCard remains deeply committed to driving digital transformation across the continent, working closely with entrepreneurs, merchants, banks, start-ups, telcos, and governments. By increasing our investments, expanding innovation, and fostering inclusion, we are helping build a more connected and accessible digital future.”
The payment technology company went on to say as a longstanding technology partner to Africa, its continues to strengthen its commitment to the continent’s digital growth through strategic investments, public-private partnerships, and innovation initiatives that drive financial health and economic growth.
In addition, it says trends in Africa signal a strong shift towards digital transactions, with businesses and consumers increasingly embracing contactless solutions, further accelerating economic participation and financial accessibility across the region.
“For over five decades, MasterCard has worked alongside African governments, businesses, and communities to advance financial inclusion and economic development.
“With Africa projected to host nine of the world’s 20 fastest-growing economies, we are focused on leveraging our expertise and a technology to support the continent’s continued digital transformation.
“Our investments today will help build a more resilient economy for the future,” says Mark Elliott, division president, Africa, MasterCard
By fostering collaboration with key stakeholders, MasterCard says it aims to enhance digital connectivity, expand economic opportunities, and enable millions of people and businesses to thrive in the digital economy.
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