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California Senate Takes Up Mandating the Use of EMV Chip Cards Beginning April 1, 2016. Electronic Transaction Association Opposes It.

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California’s Senate is taking up a bill, SB 135. According to the legislative counsel’s digest (sans some of the legalese), “This bill would require retailers, starting April 1, 2016, except as specified1 [who] accept a payment card… to provide a means of processing [payment card] transactions involving payment cards equipped with embedded microchips or any other technology that is more secure than microchip technology for card-present fraud prevention.”

1No exceptions were specified. We were left scratching our heads trying to figure out what that meant. Didn’t help. Well, it did sort of. We had an itch.

“The bill would also require specified contracts entered into between a financial institution and a payment card network… to include a provision requiring that a new or replacement payment card issued to a cardholder with a California mailing address have an embedded microchip or any other technology that is more secure than microchip technology for …fraud prevention.”

That’s the gist of the bill. If you want the grist, here’s a link.

An email from the Electronic Transactions Association (ETA), the global trade association that represents more than 500 payments and technology companies, calls on Californians to block the bill.

The ETA’s reasoning, according to its email, is that the legislation would “stifle free market innovation. Passing a single state technology standard will open the floodgate to additional state responses and create an expensive, unsafe, and inefficient myriad of technology standards.”

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