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RBI pushes Indian banks to meet EMV liability shift deadline

May 31, 2016

The Reserve Bank of India has issued a bulletin to the nation's banks, advising them of the need to enable their ATM fleets for EMV chip-and-pin cards before the card networks' liability shift deadline of Oct. 1, 2017.

According to an RBI circular:

While the POS terminal infrastructure in the country has been enabled to accept and process EMV Chip and PIN cards, the ATM infrastructure, on the whole, continues to process the card transactions based on data from the magnetic stripe. As a result, the ATM card transactions remain vulnerable to skimming, cloning, etc. frauds, even though the cards are EMV chip-and-PIN based.

It has, therefore, become necessary to mandate EMV chip-and-PIN card acceptance and processing at ATMs also. Contact chip processing of EMV chip and PIN cards at ATMs would not only enhance the safety and security of transactions at ATMs but also facilitate preparedness of the banks for the proposed "EMV liability shift" for ATM transactions, as and when it comes into effect.

Existing bank ATMs should be ready by Sept. 30, 2017, RBI said, and all new ATMs should be EMV-enabled "from inception," RBI said. To ensure uniformity in the card payments ecosystem, banks should also implement at their "micro-ATMs," which handle card-based payments.

Banks operating in India also have been advised to submit a quarterly report RBI, recapping their progress toward EMV implementation.