Since fraud liability shifts to the least compliant party after the network-mandated EMV migration dates, it is critical that financial institutions migrate all channels, including ATMs.
For that reason, many FIs are in the process of creating an ATM transition plan. This includes evaluating the current state of your ATM fleet and making the decision to upgrade or replace existing terminals.
The U.S. payments infrastructure is steadily moving toward EMV readiness. To incent EMV compliance, various mandates and liability shifts are taking place between now and October 1, 2017. With timelines in place for a shift in liability, the total cost of card-present fraud will no longer be borne solely by card issuers.
For example, if an ATM cannot accept an EMV chip card after its designated liability shift date, the ATM acquirer (such as the bank or credit union) will bear the cost of any fraud. Financial institutions that still need to upgrade or refresh their ATM footprint must take this opportunity to invest in new EMV-capability equipment to avoid these liability risks.
Although making large-scale changes to enterprise technology can be complex, the cost to upgrade existing equipment can be more expensive than replacing an ATM. New ATM options offer improved reliability and greater capacity that helps to boost customer satisfaction by ensuring a better experience and less down time. This in turn provides more value for financial institutions and allows them to improve customer services and eliminating liability without incurring unnecessarily large upgrade costs.
Planning for EMV transition also gives financial institutions the opportunity to re-assess the types, number and location of ATMs in their network. Institutions can work closely with their vendor partners to evaluate the direct costs and customer utilization patterns associated with each ATM in their network.
It may make sense to replace some terminals and eliminate others all-together. Likewise, EMV transition provides institutions with an opportunity to evaluate their need for other capabilities, such as automated deposit, and make those transitions at the same time.
Ready or not, the EMV migration is here. By educating themselves about EMV benefits, mandates and liability shifts, financial institutions can ease the transition. Likewise, financial institutions can seize this opportunity to replace aging or outdated ATM terminals, and cost-effectively add other capabilities that will increase customer satisfaction and branch efficiency.
Bob Gibson is vice president of branch operations for Cummins Allison.
