MasterCard shifts fraud liability to ATM owners
Effective April 19, 2013, MasterCard will shift the fraud liability on its Maestro overseas debit cards to the ATM owner. This applies to all ATMs that use magnetic stripe card readers rather than the new EMV card readers.
Virtually no ATM company is going to be ready because the ATM manufacturers have just recently released the option of purchasing the EMV card readers and software. In addition, the core processing companies for ATM transactions are still not certified to handle EMV. Therefore, the ATM companies are caught in the middle with their hands tied.
The April 19 deadline applies only to MasterCard-branded debit cards that are issued by overseas banks and used at U.S. ATMs. That is roughly 1% of all U.S. ATM transactions, or roughly 60 million swipes a year.
If the ATMs aren't upgraded to EMV, the owners will be financially responsible for fraudulent transactions linked to those cards. The losses could mount quickly; one sizable fraud could wipe out the annual profits for a machine.
Full transition to EMV will be necessary in the upcoming couple years. This will apply to all MasterCard and VISA transactions on both foreign and domestic cards. Therefore, all ATM owners are urged to begin migrating their ATM portfolio to the new EMV card readers and software with hope that the processors will be certified for EMV soon.