NEW DEADLINE FOR EMV COMPLIANCE
BSP says many banks, even the big ones, were unable to comply with Jan. 1 deadline EMV is a global standard for inter-operation of integrated circuit cards
The Bangko Sentral ng Pilipinas (BSP) plans to set another deadline for Philippine banks’ EMV compliance.
EMV, which stands for Europay, MasterCard and Visa, is a global standard for inter-operation of integrated circuit cards capable of authenticating pointof-sale transactions.
Philippine banks were required to be EMV- compliant by Jan. 1, but BSP Deputy Governor Nestor Espenilla Jr. said not all banks were able to meet the deadline.
He said some players were more than ready to meet the target but others, including the big banks, did not meet the deadline due partly to the volume of cards to be replaced.
He said this is why the central bank implemented the EMV Card Fraud Liability Shift Framework (ECFLSF) since Jan. 1 this year.
The BSP, in a statement issued in December 2016, said ECFLSF was a “market-based enforcement mechanism” and targeted to protect central bank-regulated financial institutions “from financial liability arising from losses on counterfeit card fraud.”
It explained that ”liability for this type of fraud shall shift to the BSFI (BSP-supervised financial institutions), which is not or is only partially compliant with the EMV requirement.”
”This is considered fair and appropriate since the industry has been given more than three years to undertake full migration,” it said.
“That’s already, in a way, a market punishment,” Espenilla said, but stressed that “we also still need another deadline.”
The BSP official said the central bank needs to set a “hard deadline” for EMV compliance but admitted that there is a challenge regarding tailor fitting.
He said sanctions would be put in place once the new deadline had been set but also stressed that “in between that there’ll be a tailor fitted deadline depending on their level of progress and their challenges.”
He said banks were required to submit an update on their EMV-compliance and their commitments on how they would meet the requirements.
He added that he would submit a report to the BSP’s policy-making Monetary Board (MB) regarding the progress of EMV compliance among banks. /