A dispute that has gone on for more than a year over how to route EMV debit card transactions while complying with a law requiring that United States merchants be given the choice of two separate debit networks to route purchase transactions appears to be near an end. MasterCard and Visa now say they will share their common U.S. debit application identifiers (AIDs), thus enabling debit transactions initiated with EMV cards to originate from a single application.
In March, 10 debit networks chose Discover’s D-Payment Application Specification (D-PAS) ) to accomplish dual-routing support as required by Regulation II under the Dodd-Frank Wall Street Reform and Consumer Protection Act. However, Visa and MasterCard had not agreed to join with them, preferring to maintain their own debit AIDs. Their agreement now enables them to share merchant access to their networks with those of the other debit networks from a single application in an EMV card’s chip.
Issuers will be able to load their global brand’s application onto their cards — either Visa or MasterCard — and flexibly enable transactions to route over any participating PIN debit network within the U.S.
Chris McWilton, president, North America, MasterCard, says: “By providing every U.S. debit network with an efficient, market-ready answer, we are delivering a proven solution that not only preserves merchant routing choice, but ensures seamless interoperability with all other EMV programs across the globe.”
Elizabeth Buse, global executive, Solutions, Visa, adds: “Importantly, this solution allows merchants and acquirers to deploy payment terminals using existing chip technologies that are already widely integrated into existing chip card acceptance solutions.”
Pressure, led by Walmart, was mounting on the various networks to strike an agreement to incorporate their AIDs on a single application. It now appears they have struck a compromise to enable that to happen. A final, workable solution still must be worked out, but the agreement by Visa and MasterCard should help speed up the process and allow issuers to develop more concrete plans for EMV card rollouts. That process should begin in 2014, though expect some large issuers to hold off until 2016 before conducting major issuance of debit cards with EMV chips.
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