EMV Won't Affect Most U.S. Banks

Interview with Don Rhodes, director of risk management for the American Bankers Association, on why chip and PIN doesn't make sense for many U.S. banks.New York-based United Nations Federal Credit Union grabbed headlines last month with its announcement to begin issuing EMV chip and PIN cards to its U.S. cardholders. As card-skimming risks and problems with payments on mag-stripe cards overseas began to escalate for the credit union's globally mobile membership, UNFCU said it decided a move to EMV would make sense. But the move won't make sense for all U.S. financial institutions, says Don Rhodes of the American Bankers Association.

Rhodes, director of risk management for the ABA, says migrating to the EMV standard in the United States:

• Would at this time be too expensive for U.S. card issuers, retailers, banks and credit unions;
• Is not yet warranted by current card fraud levels;
• Only makes sense for niche financial players such as UNFCU, which has a large percentage of its membership living and working overseas.

Don Rhodes is the director of risk management policy for the American Bankers Association. Rhodes joined the ABA in 2001 and is responsible for keeping the banking industry informed about trends in payment system technology and electronic banking. Don manages the ABA's interests in combating online fraud and in implementing stronger online authentication. He also is responsible for issues regarding credit and debit card operations and operational risk management policy issues, including critical infrastructure protection. Prior to joining the ABA, Rhodes was president and chief executive of a financial institution and has held positions with the Ninth District Federal Home Loan Bank and Hibernia National Bank of New Orleans, as well as experience with another Washington-based banking trade association. He has published articles in banking trade publications and appears regularly in print and broadcast media. He is a graduate of the University of Central Arkansas, the U. S. Marine Corps Command and Staff College, the Savings and Loan Institute of the South, the Visa Business School and the Arkansas Institute of Politics and Government.