EMV and NFC: Complementary Technologies Enabling Secure Contactless Payments

Publication Date: November 2015

As the U.S. migration to EMV chip payments continues, industry participants are thinking about preparing to process payments made using EMV contact chip cards, EMV contactless chip cards, mobile Near Field Communication (NFC) devices, or all three. Yet for some, misconceptions around what NFC technology really is and how it can be used with EMV chip payments persist. The white paper, “EMV and NFC: Complementary Technologies Enabling Secure Contactless Payments,” clarifies how NFC and EMV work as companion technologies.

EMV is a global standard for secure debit or credit payments made using chip cards at a merchant who has an EMV chip-acceptance infrastructure.  EMV-compliant chip card payments protect against the use of counterfeit, lost, or stolen cards and skimming.  Issuers, merchants, consumers, and acquirers/processors can all benefit from EMV.  As a result of the EMV fraud liability shift in October 2015, merchants, issuers, and processors in the United States are in the final stages of upgrading their infrastructures.

EMV is a payments technology.

NFC is a communications technology that enables contactless EMV.

Simultaneously with the U.S. move to EMV chip card payments, Near NFC technology is emerging as a useful accessory for consumer transactions.  NFC is not a payment technology; it is a set of standards that enables proximity-based communication between consumer electronic devices such as mobile phones, tablets, and personal computers.  NFC supports an extremely simple man-machine interface, facilitating its use for a number of functions, including mobile payment.  NFC technology is compatible with the current contactless payment acceptance infrastructure—an NFC-compliant mobile device can communicate with a point-of-sale (POS) system that currently accepts contactless payment cards.

NFC and EMV are companion technologies.  NFC applies to how devices communicate; EMV applies to payments made with contact and contactless chip cards or with a mobile NFC device emulating a contactless chip card.  Contactless payment transactions made using mobile NFC devices use the same infrastructure as contact and contactless EMV chip card transactions.

The white paper describes the current status of the U.S. payment issuance and acceptance infrastructure, identifies impacts, benefits and key considerations for contactless payment migration. Topics covered include:

  • The current status of the EMV chip migration and predictions for contactless payments in the U.S., including the number of chip cards issued, the number of merchant locations accepting chip cards, and predictions for contactless cards over the next two years
  • The intersection EMV contact, contactless and dual interface chip cards and mobile NFC devices for payment describing how chip cards are provisioned, how they’re used in stores, how payment account credentials are provisioned into mobile NFC devices, and how mobile NFC devices are used for contactless payments
  • Key considerations for contactless payment implementations, such as how to migrate from contactless magnetic stripe card acceptance to contactless EMV chip card acceptance, what types of transactions to accept, how contactless payment adoption is affected by mobile NFC device availability, and other usability factors

About the White Paper

The Smart Card Alliance Mobile and NFC Council and Payments Council developed this white paper to explain how EMV and NFC are companion technologies and clarify how they work together to enable secure payments.  Participants involved in the development of this white paper included:   ABnote; Advanced Card Systems; American Express; Booz Allen Hamilton; Capgemini; CH2M; Consult Hyperion; CPI Card Group; Cubic; Discover Financial Services; Exponent, Inc.; First Data Corporation; FIS; Fiserv; Gemalto; Giesecke & Devrient; Heartland Payment Systems; Hewlett Packard Enterprise; Infineon Technologies; Initiative for Open Authentication (OATH); Ingenico; IQ Devices; JPMorgan Chase; MasterCard; Metropolitan Transportation Authority (MTA); Mozido CorFire; NBS Technologies; NXP Semiconductors; Oberthur Technologies; Quadagno & Associates; SHAZAM; STMicroelectronics; Thales e-Security; TSYS; Valid USA; Vantiv; Verifone; Visa Inc.; Wells Fargo; Xerox.

About the Smart Card Alliance Mobile and NFC Council

The Smart Card Alliance Mobile and NFC Council was formed to raise awareness and accelerate the adoption of payments, loyalty, marketing, promotion/coupons/offers, peer-to-peer, identity, and access control applications using NFC.  The Council focuses on activities that will help to accelerate the practical application of the technology, providing a bridge between technology development/specification and the applications that can deliver business benefits to industry stakeholders.

The Council takes a broad industry view and brings together industry stakeholders in the different vertical markets that can benefit from mobile and NFC applications.  The Council collaborates on: educating the market on the technology and the value of mobile and NFC applications; developing best practices for implementation; and working on identifying and overcoming issues inhibiting the industry.

About the Smart Card Alliance Payments Council

The Smart Card Alliance Payments Council focuses on facilitating the adoption of chip-enabled payments and payment applications in the U.S. through education programs for consumers, merchants, issuers, acquirers/processors, government regulators, mobile telecommunications providers and payments service providers.  The group is bringing together payments industry stakeholders, including payments industry leaders, merchants and suppliers, and is working on projects related to implementing EMV, contactless payments, NFC-enabled payments and applications, mobile payments, and chip-enabled e-commerce.  The Council’s primary goal is to inform and educate the market about the value of chip-enabled payments in improving the security of the payments infrastructure and in enhancing the value of payments and payment-related applications for industry stakeholders.  Council participation is open to any Smart Card Alliance member who wishes to contribute to the Council projects.