2010 Scotiabank Commercial Card Conference

CHIP & PIN Migration

Presented by:

Dan Berkovich

Commercial Card Product Manager, Canadian Market

G L O B A L T R A N S A C T I O N B A N K I N G2010 Scotiabank Commercial Card Conference

Agenda

What is a Chip Card? Why migration to Chip? Migration time-lineMigration ExclusionsCard Production during MigrationCardholder ExperienceCardholder Communication‘Fact Sheet’ Review

G L O B A L T R A N S A C T I O N B A N K I N G2010 Scotiabank Commercial Card Conference

What is a Chip Card?

A debit or credit card that contains an embedded computer chip which allows it to securely store and process data.

G L O B A L T R A N S A C T I O N B A N K I N G2010 Scotiabank Commercial Card Conference

What is a Chip Card?

Chip can handle stand alone or multiple applications (Credit, Debit, Loyalty, etc)

Chip cards require a PIN

Chip card carries all the data conventionally on a magnetic stripe and much more … allowing more functionality and “two way” dialog

Chip hardware and the cryptographic standards are virtually hack proof

EMV Co (Europay, MasterCard, VISA) have clearly established international interoperability standards: cards, ABM’S, point of sale devices, issuers and acquirers

G L O B A L T R A N S A C T I O N B A N K I N G2010 Scotiabank Commercial Card Conference

Why migration to Chip?

Provides increased protection against counterfeit, lost and stolen card fraud.

Provides potential for added card functionality.

Moves the Canadian financial industry to a technology proven, and in wide use around the world.

Credit card fraud has been significantly reduced in over 45 counties where Chip & PIN technology has been introduced. Fraud moves to the ‘weakest link”

In the UK High street losses on face to face transactions fell from £ 218.8m in 2004 to £ 73M in 2007 ( 67% reduction )UK counterfeit card fraud decreased 32% in 2007 UK cash machine fraud decreased by 44% in 2007

VISA Liability Shift

G L O B A L T R A N S A C T I O N B A N K I N G2010 Scotiabank Commercial Card Conference

Migration time-line*

Chip Functionality Enabled at

Company Level

Qualifying accounts have expiration

date updated and cards requested

Cards produced & sent to company

or cardholder

First Business Day of Migration

Month

Middle of Migration

Month

Ten Business Days after Migration

*All time-frames are approximate and depend on migration month

Old cards are deactivated

Three Months following card

receipt

G L O B A L T R A N S A C T I O N B A N K I N G2010 Scotiabank Commercial Card Conference

Migration Exclusions

New cards issued since Chip functionality was enabled

Cards reported lost/stolen since Chip functionality was enabled

Cards that naturally reissued during the migration month

Accounts with zero plastic outstanding (i.e. Ghost cards )

Any accounts that would not qualify for a natural reissue(i.e. Closed Accounts)

G L O B A L T R A N S A C T I O N B A N K I N G2010 Scotiabank Commercial Card Conference

Card Production during Migration

Due to the large volumes of cards being produced during the Chip Migration, the estimated production time will be 10 business days.

Contact Centre will wait until following day to order Chip cards

Any non-migrating Chip cards ordered during migration will be purged andreordered in order to avoid increased production times.

Cards produced during any other day of your migration month will be subject to normal production times. These include:

Natural Reissue Card New Cards Lost / Stolen CardsRejected Cards from Migration

G L O B A L T R A N S A C T I O N B A N K I N G2010 Scotiabank Commercial Card Conference

Cardholder Experience

Card Activation

In order to activate their Commercial Chip Cards and select a PIN, cardholders will require:

1. Their Date of Significance

2. Their reference number (located on the card carrier)*

* Reference number will be required for any future PIN changes

G L O B A L T R A N S A C T I O N B A N K I N G2010 Scotiabank Commercial Card Conference

Cardholder Experience

First Chip Transaction after card activation & PIN Selection

PIN will become enabled after first transaction at a Chip terminal

Cardholders will not be prompted to enter their PIN

Terminal will automatically print a slip for cardholder to sign

All subsequent transactions at Chip terminal will require a PIN

First Chip Transaction after PIN change

Cardholders will need to enter PIN three times

G L O B A L T R A N S A C T I O N B A N K I N G2010 Scotiabank Commercial Card Conference

Cardholder Communication

Chip Card Carrier

G L O B A L T R A N S A C T I O N B A N K I N G2010 Scotiabank Commercial Card Conference

Cardholder Communication

Cardholder Guide

G L O B A L T R A N S A C T I O N B A N K I N G2010 Scotiabank Commercial Card Conference

“Fact Sheet” Review

G L O B A L T R A N S A C T I O N B A N K I N G2010 Scotiabank Commercial Card Conference

Questions?

G L O B A L T R A N S A C T I O N B A N K I N G2010 Scotiabank Commercial Card Conference

Thank you!