ATLANTA – SEPT. 9, 2014 – First Data Corporation the global leader in payment technology and services solutions, today announces its participation with Apple Pay, a new category of service that will transform mobile payments with an easy, secure and private way to make purchases from your mobile device. First Data’s support of Apple Pay will also allow businesses and their app developers to go to market quickly with powerful new apps allowing payment with a single touch.

“Apple Pay has transformed mobile payments in a way that our clients will love, and will have an impact on the industry like never before,” said Frank Bisignano, First Data’s Chairman and CEO. “We’re thrilled to bring First Data solutions to support Apple Pay, along with the financial institutions, merchants developing apps and consumers to provide an easy, safe and secure way to pay with a single touch.”

First Data’s support of Apple Pay marks another milestone in First Data’s transformation from a payments processor to a solutions provider. “Our overriding purpose is to help clients grow their businesses, and a key driver of that is through technology allowing card issuers and merchants, large and small, to bring new payment options to their customers, including revolutionary trends in mobile payments,” Bisignano added. “Staying ahead of these trends, as a grand collaborator, we are also giving developers tools they need to quickly and easily code and enable online and mobile payments, including Apple Pay.”

New Benefits for Consumers: How First Data helps protect mobile transactions

With card security more important than ever, First Data’s integrated token services support the safety of both online and point-of-sale transactions.

A process called “tokenization” ensures the consumer’s credit or debit card data is shielded during transactions. In the tokenization process, consumers enter their card information into the digital wallet of a mobile device.

With cardholder information protected by the token, account numbers are difficult to compromise, thereby reducing the risk of fraud.

New Benefits for Merchants: Empowering Businesses with a Safe, Secure Mobile Transaction

The arrival of Apple Pay opens a world of opportunity for merchants of all sizes to grow their businesses. Consumers are looking for a transaction experience that is as easy as touching a phone to a point-of-sale terminal, yet as secure, or more so, than traditional credit card transactions where the card is “swiped” through a terminal.

With industry standard Near Field Communication (NFC) technology at the point-of-sale, Apple Pay enables a seamless experience. Users simply hold their iPhone near the contactless reader while keeping a finger on Touch ID™. A brief vibration of the device lets the user know the reader successfully received the payment information, saving both time and hassle. Contactless terminals are also a popular option for merchants looking to prepare for upcoming migration to EMV™ chip card acceptance in 2015. First Data provides a range of contactless terminal options that are ready to accept both this latest technology and chip-enabled cards at the point of sale.

First Data is already powering some of the world’s leading consumer brands as they prepare to welcome customers ready to use this latest payment technology.

New Benefits for Developers: Easy Access to App Building Software

The First Data eCommerce solution, called Payeezy^SM, rapidly enables developers and merchants to give consumers the ability to use their new payment features with new mobile devices equipped with InApp capability.

The process of developing a new app for mobile devices equipped with this new payment functionality begins by downloading First Data’s solution available at www.payeezy.com/iospayments. Apple has developed a software developer kit (or “SDK”) for developers. The SDK gives merchants and their developers all of the tools they need to get started immediately building an InApp experience that is safe, easy-to-use, commerce-enabled and cost-effective for businesses of all sizes.

New Benefits for Issuers: How First Data’s STAR Network Shines Bright in the New World of Mobile Payments

Issuers seeking an additional payment processing network can now look to First Data’s STAR Network as the leading independent debit network that will accept Apple Pay debit transactions when it becomes available later this year.

“First Data stands ready to work with all of our clients to help them take full advantage of Apple Pay,” said Bisignano. “The introduction of Apple Pay is an exciting complement to the point-of-sale transformation we introduced merchants to earlier this year with the introduction of First Data’s Clover Station. Clover has proven to be a game changer with merchants, and the launch of Apple Pay helps Clover merchants create a truly winning combination.”

Today marks another milestone in First Data’s ongoing transformation. Since 2013, the company has focused its strength on driving advances in global commerce, recently introducing the small business solution Clover™ Station, which transforms the point of sale into a dynamic business system. First Data’s Insightics^SM solution, Perka™ loyalty and Gyft^® prepaid solutions further enhance the small business experience. Alongside Apple Pay, First Data taps into its history as a trusted payments processor, and reflects First Data’s continuing transformation into one of the world’s leading tech companies to bring tomorrow’s innovations to market today.

First Data is currently enrolling financial institutions, merchants and developers in its ecommerce and tokenization solutions. First Data has teams ready to help these businesses and organizations quickly and efficiently prepare to do business using digital wallets. To learn more, contact:

• Merchants: +1 866-382-8643
• Financial Institutions: +1 800-337-1222
• Developers: +1 855-799-0790
• STAR^® Network: +1 877-866-7827

Or visit www.firstdata.com/mobilepayments.

EMVTM is owned by EMVCo LLC. Touch IDTM is a trademark of Apple Inc.

About First Data

First Data is a global technology leader in the financial services industry. With 24,000 employee-owners and operations in 35 countries, the company provides secure and innovative payment technology and services to more than six million merchants and financial institutions around the world, from Main Street shops to the world’s largest corporations. Today, businesses in nearly 70 countries trust First Data to secure and process more than 2,000 financial transactions per second, totaling $1.8 trillion a year. First Data’s unparalleled infrastructure, scale and partnerships go “beyond the transaction” with next-generation point-of-sale technology fueled by powerful analytics to detect fraud, gain insights into consumer spending, and strengthen customer loyalty. All day, every day, First Data helps its clients thrive in the evolving world of commerce.

What it means is that you likely will “dip” your card – more akin to how you’d use it at an ATM – rather than swiping a reader.

And retailers have a major incentive to make the switch: After Oct. 1, 2015, any fraudulent charges will fall on them rather than the credit card issuer if the store’s technology isn’t up to date.

Recently hacks of major retailers like Target, Home Depot and Jimmy John’s have made news. Part of the problem may be that the United States still uses swipe card technology that is less secure than what’s used in Europe and Canada.

Currently when you swipe your card at a retailer, the reader takes your credit card number and expiration date and sends it to be authorized by the card issuer.

What much of the rest of the world uses is EMV, which stands for Europay, Mastercard and Visa. With this technology, the store reads a chip on the card. The chip allows the card to be authenticated but also includes a one-time use security code in every transaction.

The difference is how long stolen credit card information is good for, says John Mayleben, Michigan Retail Association Senior Vice President of Technology and Product Development.

Right now he said if you drop your wallet somebody could scan a credit card, make a fake duplicate and use it until you notice unusual activity on your account. With an EMV chip, somebody who accessed the data would get it with that one-time-use security code. That security code is only good for the next transaction, and changes after that.

So then it’s a race. If you use your card first the thief’s fake will get denied because it will have the wrong security code. If the thief uses the information with the temporary code first, he or she can make only one transaction. After that the thief’s temporary code would be wrong and the card would be denied.

“What it does is it accelerates the time from theft to stopping the theft,” Mayleben said.

Major credit card companies are pushing this change. The EMV Migration Forum is an independent body with more than 140 member companies, including global brands like American Express, Visa and MasterCard Worldwide. It’s putting into motion new policies aimed to make retailers switch over.

Randy Vanderhoof, director of the EMV Migration Forum, said what’s changing on Oct. 1, 2015 is who pays for a fraudulent purchase. Right now card issuers typically pay for any fraudulent activity. Starting in October of next year, whichever entity’s technology isn’t updated will have to bear the burden.

That means that if a thief uses a card with an EMV chip at a store without an EMV chip reader, the store pays. Conversely, if the store has an updated card reader but the bank is still issuing cards without EMV chips, the bank would have to pay for the fraudulent transaction.

Abtek, a Michigan-based credit card processing company that serves small and medium businesses, offers a more secure transaction called “tokenization”. When you swipe a card the system transmits random numbers that correlate to your card instead of your card’s straight information. On top of that, Abtek can encrypt information.

But Abtek Vice President Tami Cohorst said businesses are sometimes slow to want this or other protections.

“All this is an expense to the business owners. Expenses that they aren’t used to having,” Cohorst said.

Mayleben said the retailers association also handles credit card transactions for businesses, and is trying to prepare them for the EMV switch.

“We have been actively deploying machines that are chip card compatible,” Mayleben said. But it’s unlikely that by October of next year every retailer will have switched over, he noted.

Vanderhoof said each retailer should weigh the cost of implementing EMV chip card acceptance versus the cost of taking on additional fraud.

“They should also keep in mind that criminals will go after the weakest link; even if a retailer does not experience a lot of fraud today, not accepting chip cards could make their locations more attractive to criminals looking to commit counterfeit card fraud,” Vanderhoof said.

As far as consumer experience goes, Mayleben said the customer using an EMV chip card will “dip” instead of “swipe” the card. It’s a vertical insertion more akin to putting the card in an ATM than swiping it at the grocery store. EMV readers are typically at the bottom of devices.

“It is a completely different user experience than what we’re familiar with as consumers,” Mayleben said.

In Europe, the EMV transaction is sometimes referred to as “chip and PIN.” However in the U.S. the EMV Migration Forum advises that “Not all chip cards issued in the U.S. will require the use of a PIN.”

Cohorst said the PIN instead of a signature is used in the rest of the world, and would add an additional layer of security.

“I think the issuers might re-think that, and I think we’ll see more pin-based cards than we had anticipated,” she said.

In the Lansing area, retail locations including Target and Kroger have installed card readers that can process both traditional swipe and EMV chip readers, though the chip readers aren’t yet activated. Some card issuers are also issuing cards with EMV chip capability.