Bank of Israel Governor Prof. Amir Yaron: “Increasing the maximum amount for a contactless transaction will help accelerate the implementation of EMV technology at merchants during this complex period, so that customers will be able to make transactions using more secure and more rapid technology.”
As part of promoting the use of advanced means of payment, and particularly the use of contactless transactions[1] at merchants, a uniform cardholder verification (CVM) limit was set at NIS 200, above which contactless transactions made over the EMV[2] infrastructure required the customer to key in a PIN number. In order to improve dealing with the corona pandemic, and in order to further reduce contact when making payment transactions, the Bank of Israel has decided in conjunction with the various actors in the payment card market, as part of the payment card committee, to raise the limit to NIS 300. The limit will be raised by the end of 2020, and the issue will be raised toward the end of the period for further discussion within the payment card committee.
Accordingly, when making a contactless transaction with a value lower than the limit, the customer will not need to key in the card’s PIN number, and the transaction will be made by holding the payment card in proximity to the smart terminal at a merchant that has converted its acquiring system to one that operates using EMV technology. A contactless transaction will also be enabled through a smart cellular device supporting contactless transaction functions.
This revised limit will be fixed and uniform for all transactions made at merchants that have converted to EMV, and will also be available for transactions made by tourists. This decision is similar to the decisions made in various European countries to raise the limit.
As of today, about 85 percent of all payment card transactions made at merchants are for amounts that do not exceed NIS 300, and about 75 percent of them are below NIS 200.
In addition, in order to promote contactless advanced payments above the CMV limit of NIS 300, when carrying out contactless transactions using a smart cellular device, a second verification may be made on the device in accordance with the verification minimum, for instance using a code or biometric identifier.
The decision to raise the verification limit comes in parallel to the agreement by some of the marketing and pharmacy chains to accelerate the implementation of EMV during this challenging period with the help of the payment card committee led by the Bank of Israel. In our assessment, an increasing number of merchants will be carrying out payment transactions using EMV technology in the near future.
[1] A contactless transaction is a transaction in which no physical contact is necessary between the payment card and the merchant’s terminal. The transaction is carried out using proximity technology.
[2] A collection of specifications developed by international organizations for payment cards with the aim of providing a uniform and secured format for transactions using payments cards with chips (smart cards), ATMs or a point of sale (POS) terminal supporting the standard.