Quick Chip / M-chip: Not So Fast

Posted By: Art Harper | May 31, 2016 | 2 Comment

With the first wave of the EMV liability shift in the US underway, issuers, merchants and cardholders have been experiencing both benefits and challenges at the point-of-sale terminal. As projected, EMV provides more secure protection during transactions for cardholders; however merchants and cardholders alike have been challenged by the perceived additional time to complete the transaction. These concerns, an angle that the media has echoed, pushed both Visa and MasterCard to create a new chip for EMV cards designed to improve transaction speeds.

Welcome to the Quick chip / M-chip. Does it really speed up the checkout?

The idea behind Quick chip / M-chip is that instead of keeping the card inserted in the point-of-sale terminal until completion of the transaction the cardholder will be able to insert and quickly remove the card, similar to just swiping in the old mag stripe environment. Behind the scenes, this process is just around the authorization / final transaction amount; it does not affect other EMV functionalities like automatic transaction counters.

Both Visa and MasterCard state the Quick chip/M-chip allows cardholders to remove their card prior to final authorization of the transaction. However, will the merchant be able to move forward and let the consumer out of the store before the authorization comes back with an approval or denial of the transaction? Unlikely. The real question to be asked, is will the Quick chip/M-chip reduce the complete transaction time at the point-of-sale?

What is the ramification to an issuer or merchant implementing the new Quick chip/M-chip? Does it require the issuer to reissue cards? The answer is no. Does the merchant have to re-certify their point-of-sale terminals? Visa issued the following statement:

The Quick Chip solution only requires a software download. It does not require any changes to standard EMV processing or to the chip card. No additional Visa or EMVCo testing or certification is required, and there is no impact to routing, your merchant bank, the network, or the card issuer.

To date, neither American Express nor Discover has announced their intentions regarding this new type of chip. Alignment in the payments industry is important, so we need to stay tuned to actions these card brands may take. The end game, as an issuer or cardholder, is to have a card that provides us with a secure transaction in a timely manner. Keeping current on new opportunities like Quick chip / M-chip or the discussion around other EMV developments is the prudent course of action.

Art Harper

Art Harper

Art is responsible for the management and growth of EMV products and services and is a member of the EMV Migration Forum participating on the ATM and Debit Working Committees. He has conducted over 50 EMV educational sessions reaching over 1500 people. Art has been involved in providing his perspective on the EMV movement in the U.S. with articles in the CU Times and CU Tech Talk.
Art Harper

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2 Comments on Quick Chip / M-chip: Not So Fast

Dr Art Harper said : Guest 3 years ago

Todd, Thanks for the comment and question. Right now, I would say this may be used just in the US market. The reason is that these functionalities were created to perceived additional time at the POS terminal. As I can speak from personal experience while in Ireland, the EMV transactions are very efficient. When I timed one transaction, it was about 3 seconds from card insertion to completion of the transaction. So the need for the other markets might not be there

Todd Lindemann said : Guest 3 years ago

Great information Art! So will the M-chip functionality only exist in the US market? If so, are we creating two user experiences for those that travel?

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