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MB Approves the Implementation Guidelines for Shifting to More Secure EMV Chip-Enabled Cards

11.21.2014

Consistent with the BSP’s continuing efforts to strengthen the electronic retail payment network, the Monetary Board approved the EMV (Europay Mastercard Visa) Implementation Guidelines governing the EMV implementation for ATM debit and prepaid cards in any card-accepting devices/terminals to safeguard customer information, reduce card fraud, and maintain interoperability of payment networks. For credit cards, only cash advance transaction at ATM terminals shall be covered since other credit card transactions are guided by the rules of the international payment networks. These guidelines are anchored on BSP Circular No. 808 dated 22 August 2013 requiring all BSIs to shift the entire payment network from the traditional magnetic stripe to more secure EMV chip technology starting 1 January 2017.

The guidelines entail the adoption of a Philippine domestic EMV specification for proprietary debit cards.  However, it does not preclude the issuers of co-branded cards from adopting established international schemes for said cards.  The guidelines also highlight BSP’s expectations in terms of managing the risks while the banking industry migrates the magnetic stripe payment environment to chip-enabled technology based on the EMV standards.  Meanwhile, the banking industry shall be given the flexibility to agree on and implement detailed technical and operational requirements, policies and procedures covering transaction routing, testing and certification, dispute and fraud risk management and other EMV-related processes. 

Since December 2013, the BSP has been closely working with key industry players to come up with a viable strategy to comply with the EMV migration requirement. Recognizing that the Philippine domestic payments environment is uniquely complex, the BSP and the banking industry have the following objectives in mind in designing the strategy: (1) leverage on global best practices in selecting the right-balanced option; (2) maintain interoperability of channels and networks and ensure that no player will be disenfranchised as a result of the migration; (3) ensure non-disruption of current ATM and Point of Sale (POS) functionalities and services being provided to consumers; and (4) establish  a national brand and prepare our industry for national payment initiatives and roadmap.

Any changes arising from the EMV implementation guidelines shall be incorporated in the EMV Migration Plan and all affected BSIs shall resubmit their updated plan to BSP within sixty (60) calendar days from date of the Circular. Finally, the BSP reiterates that all cards issued and card-accepting devices should be EMV-compliant by 1 January 2017.

The EMV Implementation Guidelines shall take effect fifteen (15) calendar days after publication of the appropriate Circular in the Official Gazette or a newspaper of general circulation in the Philippines.

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