VSDC And Visa PayWave US Acquirer Implementation Guide V2 Smart Debit Credit Pay Wave U.S. V2.0 Apr 2014

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About This Guide
1 Overview
- 1.1 Compliance Documents and Reference Documentation
- 1.2 Terminology
2 VSDC Transaction Flow
3 Visa payWave Transaction Flow
4 Visa’s Chip Terminal and Reader Requirements
5 Additional Terminal Considerations
6 Terminal Selection and Approval
7 Terminal Testing and Maintenance
8 Terminal Management Systems
9 Acquirer System Changes
10 Acquirer Host Testing
11 Acquirer Back-Office Changes
12 Merchant Support

Visa Smart Debit/Credit and Visa payWave

U.S. Acquirer Implementation Guide

Version 2.0

April 2014

Visa Smart Debit/Credit and Visa payWave

U.S. Acquirer Implementation Guide

Version 2.0

Visa International Operating Regulations Extension

April 2014

April 2014 VISA CONFIDENTIAL ii

Notice: This information is proprietary and CONFIDENTIAL to Visa. It is distributed to Visa participants for use

exclusively in managing their Visa programs. It must not be duplicated, published, distributed or disclosed, in whole

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exclusively in managing their Visa programs. It must not be duplicated, published, distributed or disclosed, in whole

Visa Smart Debit/Credit and Visa payWave U.S. Acquirer Implementation Guide

Important Note on Confidentiality and Copyright

The Visa Confidential label signifies that the information in this document is confidential and proprietary to

Visa and is intended for use only by Visa Clients subject to the confidentiality restrictions in Visa's

Operating Regulations, non-Client Third Party Processors that have an executed and current Exhibit K on

file with Visa, and terminal vendors and other third parties that have a current license agreement or

nondisclosure agreement (NDA) with Visa that covers the information contained herein.

This document is protected by copyright restricting its use, copying, distribution, and decompilation. No

part of this document may be reproduced in any form by any means without prior written authorization of

Visa.

Visa and other trademarks are trademarks or registered trademarks of Visa.

All other product names mentioned herein are the trademarks of their respective owners.

THIS PUBLICATION COULD INCLUDE TECHNICAL INACCURACIES OR TYPOGRAPHICAL

ERRORS. CHANGES ARE PERIODICALLY ADDED TO THE INFORMATION HEREIN: THESE

CHANGES WILL BE INCORPORATED IN NEW EDITIONS OF THE PUBLICATION. VISA MAY MAKE

IMPROVEMENTS AND/OR CHANGES IN THE PRODUCT(S) AND/OR THE PROGRAM(S)

DESCRIBED IN THIS PUBLICATION AT ANY TIME.

If you have technical questions or questions regarding a Visa service or capability, contact your Visa

representative.

April 2014 VISA CONFIDENTIAL iv

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exclusively in managing their Visa programs. It must not be duplicated, published, distributed or disclosed, in whole

Visa Smart Debit/Credit and Visa payWave U.S. Acquirer Implementation Guide

Table of Contents

About This Guide ...........................................................................9

Out of Scope ........................................................................................ 9

Assumptions ....................................................................................... 10

Audience ............................................................................................ 10

Document Organization ..................................................................... 10

Summary of Changes ........................................................................ 11

1 Overview ................................................................................ 12

1.1 Compliance Documents and Reference Documentation .......... 12

1.2 Terminology .............................................................................. 13

2 VSDC Transaction Flow ......................................................... 16

2.1 Initiating a Transaction .............................................................. 16

2.2 Application Selection ................................................................. 16

2.3 Initiating Application Processing ............................................... 17

2.4 Reading the Application Data ................................................... 17

2.5 Risk Management Checks ........................................................ 17

2.6 Terminal Action Analysis ........................................................... 20

2.7 Card Risk Management ............................................................ 20

2.8 Online Processing ..................................................................... 21

2.9 VisaNet Processes Acquirer Authorization Request ................ 21

2.10 Issuer Receives Authorization Request .................................... 21

2.11 VisaNet Processes the Issuer Response ................................. 22

2.12 Transaction Conclusion ............................................................ 22

2.13 Clearing and Settlement ........................................................... 22

3 Visa payWave Transaction Flow ........................................... 23

3.1 Acquirer Approaches ................................................................ 23

3.2 U.S. Contactless Acceptance Requirements ............................ 23

3.3 Contactless Processing Requirements ..................................... 24

3.4 Initiating a Visa payWave Transaction ...................................... 24

3.5 qVSDC Transactions ................................................................ 25

3.6 MSD Transaction Flow .............................................................. 28

3.7 Visa payWave for Mobile .......................................................... 30

4 Visa’s Chip Terminal and Reader Requirements ................. 31

4.1 Terminal Types ......................................................................... 31

4.2 Application Identifiers (AIDs)..................................................... 32

4.3 Language .................................................................................. 34

April 2014 VISA CONFIDENTIAL v

Notice: This information is proprietary and CONFIDENTIAL to Visa. It is distributed to Visa participants for use

exclusively in managing their Visa programs. It must not be duplicated, published, distributed or disclosed, in whole

Visa Smart Debit/Credit and Visa payWave U.S. Acquirer Implementation Guide

4.4 VSDC Requirements ................................................................. 34

4.5 Visa payWave Reader Requirements ....................................... 44

4.6 Additional Requirements for VCPS 2.1 ..................................... 48

5 Additional Terminal Considerations ..................................... 49

5.1 Magnetic Stripe Transaction Terminal Requirements .............. 49

5.2 Card Data in Online Messages ................................................. 51

5.3 Support for up to 19 Digit PANs ................................................ 52

5.4 Terminal Display Messages ...................................................... 52

5.5 PIN Length and Character Set .................................................. 53

5.6 Cardholder Receipt Requirements ........................................... 53

5.7 Transaction Routing .................................................................. 54

5.8 Acquirer Stand-In ...................................................................... 55

5.9 Deferred Authorization .............................................................. 55

5.10 Transaction Type Requirements ............................................... 55

5.11 EMV Transactions in Specific Industries .................................. 59

5.12 Purchase with Cash-back ......................................................... 60

5.13 Terminal PIN Requirements ..................................................... 60

5.14 Terminal Types and Configurations .......................................... 61

5.15 Terminal Requirements for CVM .............................................. 63

6 Terminal Selection and Approval .......................................... 64

6.1 Terminal and Reader Selection Criteria .................................... 64

6.2 VSDC Terminal Approvals ........................................................ 66

6.3 Considerations for EMV Approval ............................................. 67

6.4 Contactless Reader Approvals and Renewals ......................... 68

6.5 Payment Card Industry Requirements ...................................... 69

6.6 Acquirer Device Validation Toolkit ............................................ 70

6.7 Contactless Device Evaluation Toolkit ...................................... 72

6.8 qVSDC Device Module ............................................................. 73

6.9 Additional Toolkit Requirements ............................................... 73

6.10 Visa Chip Vendor Enabled Service (CVES) ............................. 74

6.11 Acquirer Host Testing ............................................................... 74

6.12 Implementation Activities .......................................................... 74

7 Terminal Testing and Maintenance ....................................... 76

7.1 Terminal Testing Process ......................................................... 76

7.2 Interoperability Problems .......................................................... 78

7.3 Chip Interoperability Compliance Program ............................... 80

8 Terminal Management Systems ............................................ 82

8.1 EMV Functions .......................................................................... 82

8.2 Data Elements .......................................................................... 82

April 2014 VISA CONFIDENTIAL vi

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exclusively in managing their Visa programs. It must not be duplicated, published, distributed or disclosed, in whole

Visa Smart Debit/Credit and Visa payWave U.S. Acquirer Implementation Guide

8.3 Software Updates ..................................................................... 84

8.4 EMV Functionality Considerations ............................................ 84

9 Acquirer System Changes ..................................................... 86

9.1 U.S. Acquirer Processor Mandate ............................................ 86

9.2 Terminal-to-Acquirer Interface .................................................. 86

9.3 Host System Changes .............................................................. 87

9.4 Implementation Activities .......................................................... 89

10 Acquirer Host Testing ............................................................ 90

10.1 Testing Environment ................................................................. 90

10.2 Testing Process ........................................................................ 91

10.3 End-to-End Testing ................................................................... 94

10.4 Pilot Testing .............................................................................. 94

11 Acquirer Back-Office Changes .............................................. 95

11.1 Dispute Resolution Management .............................................. 95

11.2 EMV Liability Shift ..................................................................... 96

11.3 Chargebacks and Representments .......................................... 96

11.4 Reporting................................................................................... 97

11.5 Visa Reporting .......................................................................... 98

11.6 Internal Staff Training ................................................................ 98

11.7 Implementation Activities .......................................................... 99

12 Merchant Support ................................................................. 100

12.1 Merchant Agreement .............................................................. 100

12.2 Merchant Registration ............................................................. 100

12.3 Technology Innovation Program ............................................. 100

12.4 Contactless Reader Migration ................................................ 102

12.5 Merchant Services .................................................................. 102

12.6 Merchant Systems Changes ................................................... 105

12.7 Contactless Reader Branding and Placement ........................ 105

12.8 Merchant Training ................................................................... 106

Appendix A Planning Checklist ................................................ 112

Appendix B V.I.P. System Message Requirements................. 116

Appendix C Reference Materials .............................................. 119

Appendix D Standard EMV Terminal Logic ............................. 123

Appendix E Special Terminal Logic ......................................... 124

April 2014 VISA CONFIDENTIAL vii

Notice: This information is proprietary and CONFIDENTIAL to Visa. It is distributed to Visa participants for use

exclusively in managing their Visa programs. It must not be duplicated, published, distributed or disclosed, in whole

Visa Smart Debit/Credit and Visa payWave U.S. Acquirer Implementation Guide

List of Tables

Table 1: EMV and VSDC Terminal Types ...................................................... 31

Table 2: Application Identifiers (AIDs) for Visa ISO RID................................. 33

Table 3: Application Identifier (AID) for Visa US Common Debit AID ............ 33

Table 4: Types of Cardholder Verification Methods ....................................... 39

Table 5: Acquirer Host Testing Steps ............................................................. 91

Table 6: Policy Related Tasks ...................................................................... 112

Table 7: Operational Related Tasks ............................................................. 113

Table 8: Technical Related Tasks ................................................................ 114

Table 9: V.I.P. System Field 55 Mandated Data Tags ................................. 116

Table 10: V.I.P. System Chip-related Fields ................................................. 118

Table 11: Reference Materials ...................................................................... 119

List of Figures

Figure 1: Card Requests Terminal and Transaction Data .............................. 26

Figure 2: EMV Terminal Logic ...................................................................... 123

Figure 3: Special Application Selection Using Visa US Common Debit AID 127

Figure 4: Special Application Selection Using BIN / IIN Logic ...................... 128

Figure 5: Special Application Selection Using Consumer Indication ............ 129

Figure 6: US Common Debit Application Acceptance Overview .................. 131

Figure 7: Special Contactless Application "Pre-Selection" ........................... 136

Figure 8: Combined CVM Processing and Selectable Kernel ...................... 139

•

April 2014 VISA CONFIDENTIAL viii

Notice: This information is proprietary and CONFIDENTIAL to Visa. It is distributed to Visa participants for use

exclusively in managing their Visa programs. It must not be duplicated, published, distributed or disclosed, in whole

Visa Smart Debit/Credit and Visa payWave U.S. Acquirer Implementation Guide

About This Guide

This guide is referenced in, and has the same authority as, the Visa International Operating

Regulations. The Visa International Operating Regulations governs in the event of any

inconsistency or contradiction, unless Visa specifically grants a variance.

• This guide is designed to help U.S. acquirers prepare the terminal, host and back-office

infrastructure to support a combined Visa Smart Debit/Credit (VSDC) and Visa

payWave program. Because the U.S. is an always online or ‘zero floor limit’

environment, the cost and complexity of a traditional chip implementation is reduced.

This guide includes:

• Best practices, suggestions, considerations and descriptions of step-by-step activities to

assist with the implementation.

• Information to assist acquirers in supporting their merchants as they migrate to chip.

• A Section on implementation activities to highlight the support required in each section.

• Given the nature of the U.S. payment environment, where all transactions are authorized

online, this guide focuses solely on the implementation requirements relating to online-

only terminals and does not discuss offline processing requirements in detail.

• This guide also outlines requirements for supporting VSDC and Visa payWave using the

qVSDC and MSD paths.

• This guide references a number of other Visa and industry documents that are essential

for implementing a chip program. Refer to Appendix C Reference Materials.

Out of Scope

• This guide is not intended to aid acquirers in making the decision to begin deployment of

chip devices but, provide information on benefits and features of the service or provide

in-depth educational background on chip cards, terminals or systems.

• This guide will not address the capability of other networks to carry full chip data if the

transaction is routed over a non-Visa network.

• It does not address requirements relating to:

• Tasks related to implementing a new card acceptance program.

• Offline Processing: Acquirers considering offline processing support should review the

global VSDC Acquirer Implementation Guide and the Visa payWave Acquirer

Implementation Guide.

• Support for Visa Contactless Payment Specification (VCPS )1.4.2 readers.

April 2014 VISA CONFIDENTIAL 9

Notice: This information is proprietary and CONFIDENTIAL to Visa. It is distributed to Visa participants for use

exclusively in managing their Visa programs. It must not be duplicated, published, distributed or disclosed, in whole

Visa Smart Debit/Credit and Visa payWave U.S. Acquirer Implementation Guide

• Chip processing at ATMs

Assumptions

• This document assumes that the:

• Acquirer currently accepts Visa cards at its terminals.

• Acquirer currently accepts Visa Interlink cards at its terminals.

• Acquirer is familiar with V.I.P. processing requirements.

• Acquirer is connected to VisaNet.

• Acquirer has an established mechanism for installing and configuring all devices.

Audience

• The Visa Smart Debit/Credit and Visa payWaveU.S. Acquirer Implementation Guide is

intended for acquirers, acquirer processors, and direct connect merchants in the U.S.

responsible for the implementation, testing and activation of a dual-interface acceptance

program combining support for VSDC and Visa payWave.

Document Organization

• Section 1, Overview – This Section provides an overview of chip technology and the

EMV global foundation for chip-based payment services.

• Section 2, VSDC Transaction Flow – This Section describes the VSDC chip

transaction steps at the terminal/card level and the host level.

• Section 3, Visa payWave Transaction Flow – This Section describes the Visa

payWave steps at the terminal/card level and the host level.

• Section 4, Visa's Chip Terminal and Reader Requirements – This Section describes

the requirements for deploying EMV-compliant VSDC terminals and VCPS compliant

contactless readers.

• Section 5, Additional Terminal Considerations – This Section discusses the

additional consideration for the requirements outlined in Section 2.

• Section 6, Terminal Selection and Approval – This Section is intended to assist

acquirers in creating selection criteria for chip terminals and provides background

information on the terminal approval process before deployment in the field.

• Section 7,Terminal Testing and Maintenance – This Section outlines Visa's

recommendations for acquirers to undertake post deployment testing to address and

resolve acceptance and interoperability problems that may be inadvertently introduced

during rollout.

April 2014 VISA CONFIDENTIAL 10

Notice: This information is proprietary and CONFIDENTIAL to Visa. It is distributed to Visa participants for use

exclusively in managing their Visa programs. It must not be duplicated, published, distributed or disclosed, in whole

Visa Smart Debit/Credit and Visa payWave U.S. Acquirer Implementation Guide

• Section 8, Terminal Management Systems – This Section provides the recommended

functions to be supported by a Terminal Management System (TMS) in a chip

environment.

• Section 9, Acquirer System Changes – This Section outlines acquirer system changes

to support EMV chip.

• Section 10, Acquirer Host Testing – This Section addresses acquirer host testing to

support VSDC and Visa payWave transactions. It assumes the acquirer is already a

VisaNet endpoint.

• Section 11, Acquirer Back-Office Changes – This Section addresses the technical

changes to back-office functions that acquirers will need to support an EMV chip

program.

• Section 12, Merchant Support – This Section reviews the tasks related to supporting

merchants as they make the transition to chip card acceptance. It focuses on the

merchant support needs in areas such as system changes and training.

• Appendix A, Planning Checklist – This appendix is designed to help acquirers plan the

implementation of their chip program and develop a detailed work plan.

• Appendix B, V.I.P. System Message Requirements – This appendix outlines the

mandated tags that must be supported, and the related chip fields.

• Appendix C, Reference Materials – This appendix lists all the key guides referenced

throughout the document.

• Appendix D, Standard EMV Terminal Logic – This appendix provides an overview of

standard EMV terminal logic.

• Appendix E, Special Terminal Logic – This appendix includes the special terminal

logic that is necessary for a merchant to determine the AID to be selected for an eligible

transaction. Also this appendix illustrates the special contact terminal CVM logic that is

necessary for a merchant participating in Visa’s VEPS program or a merchant that

supports cash-back.

Summary of Changes

Since this document was last published in June 2013, Visa has updated and expanded the

appendix that illustrates special terminal logic. Special terminal logic could be necessary when

accepting debit transactions. An appendix was also added to describe Standard EMV

Terminal Logic, providing an overview of standard EMV terminal logic with a specific focus on

the selection process discussed in Section 4 Visa’s Chip Terminal and Reader Requirements.

April 2014 VISA CONFIDENTIAL 11

Notice: This information is proprietary and CONFIDENTIAL to Visa. It is distributed to Visa participants for use

exclusively in managing their Visa programs. It must not be duplicated, published, distributed or disclosed, in whole

Visa Smart Debit/Credit and Visa payWave U.S. Acquirer Implementation Guide

1 Overview

• New technology is presenting Visa with exciting opportunities to provide enhanced

payment services. Chip technology based on EMV can help prevent the compromise of

sensitive cardholder data while providing consumers and merchants with fast and

convenient ways to complete purchases across various form factors including mobile.

• Because EMV provides a global foundation for chip-based payment services, adherence

to its specifications ensures global interoperability and offers enhanced security and

greater functionality to today’s Visa products. Using the EMV foundation layer, Visa has

developed additional specifications, for example, the Visa Integrated Circuit Card

Specification (VIS), the Visa Contactless Payment Specification (VCPS) and payment

service rules and implementation guidelines. Visa Smart Debit/Credit (VSDC) is a

program specifically designed to aid Visa acquirers in migrating magnetic stripe Visa

card programs and acceptance infrastructure to a chip-based payment service.

• Additionally Visa payWave provides a flexible and globally interoperable approach to

contactless transactions. It offers several implementation options – all while ensuring the

Visa payWave cards and other contactless form factors receive the same level of

acceptance whether used at home or abroad.

• To implement acceptance for VSDC and Visa payWave, as part of their migration to

chip, acquirers will need to consider various changes to their existing terminals and host

processing, including:

• New terminal applications and support for selectable EMV kernels

• Compliance with Visa and industry requirements for contact and contactless chip

terminals

• Testing and approval processes for chip terminals

• Changes to terminal and host messaging

• Changes to host systems to process new or additional data

• Back office changes

• Impact to merchants and additional training

NOTE: The term “acquirer,” as used in this Guide, will be defined as the acquirer or acquirer

processor.

1.1 Compliance Documents and Reference Documentation

• To facilitate requirements while ensuring global interoperability, terminals accepting Visa

cards must comply with the following documents:

April 2014 VISA CONFIDENTIAL 12

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exclusively in managing their Visa programs. It must not be duplicated, published, distributed or disclosed, in whole

Visa Smart Debit/Credit and Visa payWave U.S. Acquirer Implementation Guide

• Visa International Operating Regulations

• Visa Transaction Acceptance Device Requirements

NOTE: Refer to Appendix C Reference Materials for a more complete list of reference

documents and for information on where to obtain the documents listed in this

Section and throughout the Guide.

• Contact chip terminals must comply with the EMV Integrated Circuit Card Specifications

for Payment Systems, available from the EMVCo website (www.emvco.com) including

any specification updates released by EMVCo.

• Visa payWave readers must comply with the EMV Contactless Specifications, including

Book C-3, and the Visa Contactless Payment Specification (VCPS), Version 2.1

including all published updates.

• Devices accepting personal identification numbers (PINs) must comply with the Payment

Card Industry (PCI) PIN Transaction Security (PTS) Point of Interaction (POI) Modular

Security Requirements available from www.pcisecuritystandards.org and with the Visa

PCI PIN Security Requirements.

• A number of best practice documents are also available to assist acquirers in

determining their terminal requirements:

• Best practices relating to the deployment of acceptance terminals that support magnetic

stripe, contact chip and contactless chip can be found in the Visa Transaction

Acceptance Device Guide (TADG).

• Best practices relating to the Visa Easy Payment Service (VEPS) can be found on

www.visa.com in the Visa Easy Payment Service – Merchant Program Guide.

• Best practices relating to payment acceptance for retail petroleum merchants can be

found in the Visa Payment Acceptance Best Practices for Retail Petroleum Merchants.

• Risk management best practices for prepaid programs that will utilize a self-service kiosk

can be found in the Prepaid Product Risk Management Best Practices.

• In addition to complying or following best practices outlined in the above-mentioned

documents, acquirers can customize their programs beyond these minimum

requirements through adoption of optional functionality and proprietary processing.

Proprietary processing, however, must not interfere with global interoperability.

NOTE: Visa acquirers must download Visa chip documentation from the Visa Chip and Contactless

webpage on Visa Online. Please see Appendix C for information on enrolling and gaining

entitlement. Licensed vendors may download licensed Visa materials from the Visa

Technology Partner site (https://technologypartner.visa.com).

1.2 Terminology

• The following terms are used throughout this guide:

April 2014 VISA CONFIDENTIAL 13

Notice: This information is proprietary and CONFIDENTIAL to Visa. It is distributed to Visa participants for use

exclusively in managing their Visa programs. It must not be duplicated, published, distributed or disclosed, in whole

Visa Smart Debit/Credit and Visa payWave U.S. Acquirer Implementation Guide

• Acquirer – A Member that signs a Merchant or disburses currency to a Cardholder in a

Cash Disbursement, and directly or indirectly enters the resulting Transaction Receipt

into Interchange. Visa International Operating Regulations ID#: 010410-010410-

0024219.

• AID – A data element that identifies the application in a card or terminal, such as Visa

Debit/Credit or Visa Electron. It is composed of the Registered Application Provider

Identifier (RID) and the Proprietary Application Identifier Extension (PIX).

• Card (Visa Card) – A Magnetic Stripe and/or a Visa contactless card bearing the Visa

Brand Mark, or a non-Card form Contactless Payment device bearing the Visa Brand

Mark, that enables a Visa Cardholder to obtain goods, services, or cash from a Visa

Merchant or an Acquirer. All Visa Cards must bear the Visa Brand Mark.

• Chip Card – A Card embedded with a Chip that communicates information to a

Transaction Acceptance Device (TAD).

• Dual-interface Terminals – A terminal that supports both contact and contactless chip

cards and complies with the EMV Specifications and VCPS. Support for contactless may

be either as a reader separate from the POS device or via a reader integrated into a

POS device.

• EMV® Specifications – EMV Integrated Circuit Card Specifications for Payment

Systems encompassing all 4 books which make the contact chip specifications and the

EMV Contactless Specifications for Payment Systems encompassing 4 books which

make up the contactless specification plus any updates published in specification

bulletins on the EMVCo website.

• Merchant Routing Option – the option provided to U.S. merchants pursuant to the

Dodd-Frank Act and Federal Reserve Board Regulation II to route covered debit

transactions over one of at least two unaffiliated payment networks enabled on a card.

• Reader, Contactless Reader – The merchant device communicating with the card.

• There are two scenarios in which typically a reader is used for a contactless transaction:

• Either as a reader, also called a dongle or Proximity Coupling Device (PCD), separated

from, but communicating with, a POS device.

• Or as a reader integrated into a POS device.

• The word reader in this guide will cover both scenarios unless explicitly stated otherwise.

It is not intended to imply in which physical component (the reader or the POS device) a

specific action is performed.

• Terminal – A transaction acceptance device.

• US Common Debit AID – See Visa US Common Debit Application Identifier.

April 2014 VISA CONFIDENTIAL 14

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exclusively in managing their Visa programs. It must not be duplicated, published, distributed or disclosed, in whole

Visa Smart Debit/Credit and Visa payWave U.S. Acquirer Implementation Guide

• US Covered Visa Debit Card – A Visa US debit card as defined in VIOR for debit and

prepaid products covered by the unaffiliated network requirements of the Dodd-Frank

Act and Federal Reserve Board Regulation II.

• Visa Contactless Payment Specification (VCPS) – The Visa Contactless Payment

Specification, which covers versions 2.1 and all published updates.

• Visa Operating Regulations – The Visa International Operating Regulations including

any U.S. specific operating regulations.

• Visa US Common Debit Application Identifier – An EMV-compliant Application

Identifier licensed for use with Visa’s EMV and VIS-based applications for the purpose of

processing a transaction for debit and prepaid products covered by the unaffiliated

network requirements of the Dodd-Frank Act and Federal Reserve Board Regulation II.

In this document referred to as the Visa US Common Debit AID.

April 2014 VISA CONFIDENTIAL 15

Notice: This information is proprietary and CONFIDENTIAL to Visa. It is distributed to Visa participants for use

exclusively in managing their Visa programs. It must not be duplicated, published, distributed or disclosed, in whole

Visa Smart Debit/Credit and Visa payWave U.S. Acquirer Implementation Guide

2 VSDC Transaction Flow

• To better understand the impact of chip on an acquirer’s systems and processes it is

important to understand the various steps in a VSDC chip transaction. This Section

describes the steps at the terminal/card level and the host level.

• All activities, prior to the transaction going online for issuer approval, are transparent to

the acquirer and occur between the card and the terminal. Some of these functions will

not apply to terminals in the U.S. which operate as online-only terminals, and are so

noted.

• These functions are included in this Section to provide acquirers with an overall

understanding of the processing that may occur in an EMV chip transaction. Their

presence does not indicate the need to support them.

2.1 Initiating a Transaction

• The chip card is inserted into the terminal or swiped through a magnetic stripe reader. If

swiped, the terminal checks the service code in the magnetic stripe. If the first digit of the

service code indicates a chip card, the terminal prompts the sales clerk or cardholder to

insert the card into the terminal.

NOTE: To provide a faster transaction, merchants should be trained to insert the card into the

chip reader when presented with a chip card rather than swiping the magnetic stripe.

2.2 Application Selection

• The terminal determines the applications supported by the card and compares them to

the applications supported by the terminal. Application Selection is mandatory and

follows these rules:

• If the chip card and terminal have no applications in common and no application can be

selected, the device should display a message noting the card type is not supported and

fall back to magnetic stripe processing.

• If the chip card and terminal have one application in common and cardholder

confirmation is not required, that application is used.

• If the chip card and terminal have more than one application in common or if there is

a single application and cardholder confirmation is required, the terminal should display

a list of applications for cardholder selection.

• The cardholder then selects his or her preferred application from the available options

or the application is selected automatically based on the issuer priority list (including

whether or not cardholder confirmation is required) unless the Visa US Common Debit

AID selection logic described later in this document is used.

April 2014 VISA CONFIDENTIAL 16

Notice: This information is proprietary and CONFIDENTIAL to Visa. It is distributed to Visa participants for use

exclusively in managing their Visa programs. It must not be duplicated, published, distributed or disclosed, in whole

Visa Smart Debit/Credit and Visa payWave U.S. Acquirer Implementation Guide

All transactions initiated with a Visa owned Application Identifier (AID – see Section 4.2)

other than the Visa US Common Debit AID must be routed to VisaNet and be processed

according to Visa or Visa Interlink (as applicable) network operating rules and technical

standards. Some products may be personalized with more than one AID, with the other

AID(s) representing products with their own specific network and routing option(s), for

instance the Visa US Common Debit AID. To initiate a transaction using such a preferred

AID, certain terminal logic must be executed as part of the outlined VSDC transaction flow.

This logic is defined in Section 4.4.3.

2.3 Initiating Application Processing

• The terminal signals to the card that the transaction is about to begin. The card response

to the terminal includes data and risk management information for use during the

transaction. Before responding, the card performs the following steps:

1. Restrictions Check (Optional)

The card may determine if the transaction is taking place in an environment that the card

does not allow. When the transaction is not allowed for this application, the card directs

the terminal to a different application or alternatively terminates the transaction.

2. Card sends the Application Interchange Profile (AIP) and Application File Locator (AFL)

to terminal (mandatory).

The card may send a different AIP or AFL depending on the transaction environment.

For example, the card might send a different AIP and AFL for domestic versus

international transactions.

• AIP specifies the application functions that are supported by the application in the

chip card.

• AFL designates which records the terminal should read from the chip card.

2.4 Reading the Application Data

• The terminal uses the AFL to determine the card data it should read to process the

transaction. Once the terminal reads the data, it uses the AIP to determine what

processing is needed for the transaction.

2.5 Risk Management Checks

• Risk management checks are performed (if present on the card and supported by the

terminal) to determine how the transaction should be processed.

• In the U.S. all transactions require online processing, thus the terminal will send the

transaction online.

April 2014 VISA CONFIDENTIAL 17

Notice: This information is proprietary and CONFIDENTIAL to Visa. It is distributed to Visa participants for use

exclusively in managing their Visa programs. It must not be duplicated, published, distributed or disclosed, in whole

Visa Smart Debit/Credit and Visa payWave U.S. Acquirer Implementation Guide

2.5.1 Offline Data Authentication

• Offline Data Authentication allows the terminal to confirm that the card data has not been

tampered with after the card was issued by the issuer and in the case of Dynamic Data

Authentication (DDA) and Combined DDA/Application Cryptogram Generation (CDA),

protects against the re-use of copied chip data in an offline environment. This process is

important for offline capable devices where there may be a possibility of an offline

approved transaction.

• For online-only devices, Offline Data Authentication is superfluous and devices are

therefore not required to support Offline Data Authentication.

NOTE: Since all transactions in the U.S. will be sent online for issuer approval due to a

zero floor limit, support for Offline Data Authentication is not required and not

recommended. Acquirers or merchants that do not obtain an online approval do so

at their own liability.

• Depending on the card capabilities, one of the following Offline Data Authentication

methods may be performed if the terminal supports Offline Data Authentication:

• Static Data Authentication (SDA)

• Dynamic Data Authentication (DDA)

• Combined DDA/Application Cryptogram Generation (CDA) (optionally supported)

• SDA is performed by the terminal using static data read from the card. DDA and CDA

are performed by the card and the terminal using dynamic data from the card and

terminal. Offline capable devices need to support SDA and DDA.

• U.S. acquirers that consider supporting Offline Data Authentication should review the

global VSDC Acquirer Implementation Guide for further details.

2.5.2 Processing Restrictions

• The processing restrictions function is used to determine the degree of compatibility

between the application in the card and the terminal. These checks include determining

whether there are any geographic or transaction-type limitations or whether the

application on the card has expired.

• The terminal performs the following checks using data read from the card:

• Effective/Expiration Date Checking

• Application Usage Control Checking

• Application Version Number Checking

• Further information regarding Processing Restrictions can be found in the EMV

Specifications and in Section 4.

April 2014 VISA CONFIDENTIAL 18

Notice: This information is proprietary and CONFIDENTIAL to Visa. It is distributed to Visa participants for use

exclusively in managing their Visa programs. It must not be duplicated, published, distributed or disclosed, in whole

Visa Smart Debit/Credit and Visa payWave U.S. Acquirer Implementation Guide

2.5.3 Cardholder Verification

• The terminal reads the Cardholder Verification Method (CVM) List on the card to

determine the CVM to use for the transaction. It selects the CVM based on the CVMs

mutually supported (between card and terminal) and the circumstances of the

transaction.

• CVM is used by the terminal and/or the merchant to verify that the cardholder is

legitimate and that the card is not lost or stolen. The following CVM options are available

in EMV:

• Online PIN

• Signature

• Offline Plaintext PIN

• Offline Enciphered PIN

• No CVM required

• More information regarding support by terminals for each of the CVMs can found in

Section 4.4.5 Cardholder Verification, and in the Visa Operating Regulations and the

Transaction Acceptance Device Requirements.

• Terminal request of specific CVMs for specific transaction types may be supported by

selectable kernels as defined in contact EMV (see Section 4.4.6 and 8.4.2).

2.5.4 Terminal Risk Management

• The terminal performs checks based on the acquirer risk control features and the

capabilities of the terminal. For offline capable terminals, some of the checks are

mandatory whereas others are optional and at the discretion of the acquirer. The checks

include:

• Floor limit check

• Random selection

• Transaction velocity checking

• Exception file check (optional)

• Offline transaction limit check (optional)

• The results of these checks are used to determine how the terminal processes the

transaction. For online-only terminals in the U.S., these checks are not required as all

transactions will be sent online. However any acquirer considering use of offline-capable

terminals needs to ensure that terminals support floor limit checks and the floor limits are

set according to the Visa International Operating Regulations.

April 2014 VISA CONFIDENTIAL 19

Notice: This information is proprietary and CONFIDENTIAL to Visa. It is distributed to Visa participants for use

exclusively in managing their Visa programs. It must not be duplicated, published, distributed or disclosed, in whole

Visa Smart Debit/Credit and Visa payWave U.S. Acquirer Implementation Guide

2.6 Terminal Action Analysis

• The results of the previous steps are used in Terminal Action Analysis to determine the

disposition of the transaction. The results of the previous checks are stored in the

Terminal Verification Results (TVR) data element, which is then compared to specific

rules that are set by the issuer (in the card) and Visa (in the terminal).

• Depending on the results, the terminal will request a cryptogram from the card. A

cryptogram is data element dynamically generated by the card using transaction specific

data and a cryptographic key stored in the card. It allows the issuer to confirm data

integrity and that the transaction was undertaken using a valid card. The result of

Terminal Action Analysis determines which of the following cryptogram is generated:

• Transaction Certificate (TC)

• Application Authentication Cryptogram (AAC)

• Authorization Request Cryptogram (ARQC)

• For online-only terminals in the U.S., other than in some exception situations, the

terminals will always request an ARQC and go online.

• The cryptogram is generated by the card and its generation is transparent to the

terminal. Further information regarding the generation of the cryptograms and Terminal

Action Analysis processing, including exceptions, can be found in the EMV

Specifications and the Visa Integrated Circuit Card Specification (VIS).

2.7 Card Risk Management

• Card Risk Management is transparent to the acquirer, merchant and terminal. However

its outcome confirms the disposition of the transaction. It allows the card to perform

velocity checking and other risk management checks on behalf of the issuer to see if it

agrees with the terminal’s decision. The card may perform the following checks:

• New Card check

• Checking results from previous transactions (such as PIN Tries exceeded, Issuer Script

results and result of Offline Data Authentication)

• Offline spending amounts and transaction counts (Velocity) checking

• Once the card has completed the risk management checks, it responds to the terminal’s

request for a cryptogram with one of three cryptograms listed in Section 2.6 Terminal

Action Analysis.

• In the U.S., where the terminal will request to go online, the card will agree and respond

with an ARQC.

April 2014 VISA CONFIDENTIAL 20

Notice: This information is proprietary and CONFIDENTIAL to Visa. It is distributed to Visa participants for use

exclusively in managing their Visa programs. It must not be duplicated, published, distributed or disclosed, in whole

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2.8 Online Processing

• Once the card generates an ARQC for online processing, the terminal captures the

ARQC, the original data elements used by the chip card to generate the ARQC and

information regarding the selected application and the interface used. This information,

together with standard transaction data and the results of the risk management checks

are forwarded online to the acquirer.

• Acquirers format this data into the authorization message and forward the information to

VisaNet. For authorization and full financial messages, acquirers send the chip data in

Field 55 in TLV (Tag-Length-Value) format. It is critical that acquirers do not alter any of

the data received from the card and terminal as these are used by the issuer, or Visa on

its behalf, when authorizing the transaction. Altering data or data quality issues may

have serious consequences that may result in a decline of the transaction by the issuer.

2.9 VisaNet Processes Acquirer Authorization Request

• VisaNet may perform the following functions after it receives the authorization request:

• If the message format of the acquirer is different from the message format of the Full

Data issuer (Field 55 acquirer to third bit map issuer), VisaNet converts the authorization

to the issuer’s message format.

• VisaNet uses the pre-processing chip indicators to help determine whether to route to

the issuer. If the transaction is processed in Stand-In (STIP), these chip transaction

indicators influence the approve/decline decision.

• VisaNet forwards the authorization request to the issuer if it has not been processed in

STIP. If processed in STIP, the transaction proceeds as outlined in Section 2.11 VisaNet

Processes the Issuer Response.

2.10 Issuer Receives Authorization Request

• When the authorization request is received, the issuer or issuer processor will validate

the cryptogram. In certain cases Visa may validate the cryptogram on the issuer’s

behalf.

• The issuer may additionally review the chip data received in the authorization to

determine whether to authorize or decline the transaction.

• The issuer decides whether to approve or decline the transaction and sends the

authorization response to VisaNet to transmit to the acquirer. The response may

optionally include:

• An Authorization Response Cryptogram (ARPC), which is an equivalent to the ARQC

but generated by the issuer, which the card will validate.

• An Issuer Script that is typically used to reset risk parameters on the card.

April 2014 VISA CONFIDENTIAL 21

Notice: This information is proprietary and CONFIDENTIAL to Visa. It is distributed to Visa participants for use

exclusively in managing their Visa programs. It must not be duplicated, published, distributed or disclosed, in whole

Visa Smart Debit/Credit and Visa payWave U.S. Acquirer Implementation Guide

2.11 VisaNet Processes the Issuer Response

• If the issuer is participating in the Visa Chip Authenticate, VisaNet generates the ARPC

on behalf of the issuer and includes it in the authorization response to the acquirer.

Otherwise VisaNet forwards the issuer response to the acquirer.

2.12 Transaction Conclusion

• The acquirer receives the authorization response and sends it to the terminal. The card

and terminal perform final processing to complete the transaction including:

• If an ARPC is returned in the authorization response, the card validates the ARPC

to ensure that the authorization response came from a valid issuer.

• Card authenticates and executes Issuer Script commands, if present.

• The card generates the final cryptogram, a TC for approval or an AAC for decline. Once

the transaction is completed the terminal prompts the cashier or the customer to remove

the card.

2.13 Clearing and Settlement

• For approved transactions, the card generates a TC as the final cryptogram. The

acquirer then submits the approved transaction to VisaNet for clearing and settlement.

• Acquirers send TCR 0 with POS Terminal Capability Code = 5 and POS Entry Mode =

05 or 95.

• Acquirers send TCR1 if cash-back is supported.

• Acquirers send TCR 5 and TCR 7 with new chip data. Acquirers and merchants in the

U.S. deploying online-only terminals or terminals set with a Zero Floor Limit and that

obtain an online authorization for all transactions are not required to support TCR 7 in

the clearing record.

NOTE: TCR 7 is still required if a transaction is offline approved. If you plan to support

offline approved transactions please refer to the global VSDC Acquirer

Implementation Guide.

April 2014 VISA CONFIDENTIAL 22

Notice: This information is proprietary and CONFIDENTIAL to Visa. It is distributed to Visa participants for use

exclusively in managing their Visa programs. It must not be duplicated, published, distributed or disclosed, in whole

Visa Smart Debit/Credit and Visa payWave U.S. Acquirer Implementation Guide

3 Visa payWave Transaction Flow

• To better understand the impact of Visa payWave on an acquirer’s systems and

processes it is important to understand the various steps in a Visa payWave transaction.

This Section describes the steps at the terminal/card level and the host level.

• All activities, prior to the transaction going online for issuer approval, are transparent to

the acquirer and occur between the card, the reader and terminal.

• Section 4 Visa’s Chip Terminal and Reader Requirements provides further detail on

some of the steps outlined in this Section and their implementation impacts. Section 9

Acquirer System Changes provides further information regarding host processing steps.

3.1 Acquirer Approaches

• Acquirers must support Visa payWave qVSDC and MSD transactions (as per Section

3.1.2). To provide support for the long term development of the contactless platform, and

its dependent propositions such as mobile proximity and transit, Visa introduced new

requirements relating to the support of qVSDC and MSD in the U.S.

• The two approaches and Visa’s requirements are outlined in more detail in the following

sections.

3.1.1 Quick Visa Smart Debit/Credit (qVSDC)

• qVSDC transactions follow an expedited EMV-processing model and chip-processing

rules. These transactions can be sent online and validated using one of three dynamic

authentication methods, Cryptogram Version Number 17 (CVN 17), CVN 10, or CVN 18.

• The issuer decides whether to support CVN 17, CVN 10, or CVN 18, which is

personalized on the card and carried during transaction processing. qVSDC is only

suited for acceptance environments with EMV infrastructure including support for chip

data by the acquirer host.

3.1.2 Magnetic Stripe Data (MSD)

• MSD contactless transactions follow magnetic stripe processing rules. MSD transactions

are sent online and validated using CVN 17 (MSD CVN 17) or dynamic Card Verification

Value (dCVV) (MSD Legacy). MSD is best suited for magnetic stripe acceptance

environments.

3.2 U.S. Contactless Acceptance Requirements

• Effective 1 April 2013, all new Visa payWave accepting contactless readers deployed in

the U.S. must actively support both MSD and the qVSDC transaction path of VCPS 2.1

including all published updates. qVSDC may be supported on an online only basis

(i.e.no support for offline authorizations).

April 2014 VISA CONFIDENTIAL 23

Notice: This information is proprietary and CONFIDENTIAL to Visa. It is distributed to Visa participants for use

exclusively in managing their Visa programs. It must not be duplicated, published, distributed or disclosed, in whole

Visa Smart Debit/Credit and Visa payWave U.S. Acquirer Implementation Guide

NOTE: Existing Visa payWave accepting contactless readers that can only support

transactions as specified in VCPS 1.4.2 may remain in market until their natural

retirement.

• New Visa payWave accepting contactless readers deployed between 1 December 2011

and 1 April 2013 must be configured to either:

• Support only transactions as specified in VCPS 1.4.2, or

• Actively support both the MSD and the qVSDC transaction path of VCPS 2.1 including

all published updates and transmit the resulting chip data to VisaNet.

• Effective 1 January 2015, Visa contactless readers connected to acquirer platforms that

are certified for chip data no longer need to support the MSD transaction path.

• Further details can be found in the Visa Business News article dated December 22,

2011 or from a Visa representative.

3.3 Contactless Processing Requirements

• All transactions initiated with a Visa owned Application Identifier (AID – see Section 4.2)

other than the Visa US Common Debit AID must be routed to VisaNet and be processed

according to Visa or Visa Interlink (as applicable) network operating rules and technical

standards. Some products may be personalized with more than one AID, with other

AID(s) representing products with their own specific network and routing option(s). To

initiate a transaction using an AID that is not the highest priority mutually supported AID

(as specified by the card) certain terminal logic must be executed before the outlined

qVSDC transaction flow. This logic is defined in Section 4.5.1.

• Acquirers are responsible for their merchants’ compliance with Visa rules governing Visa

Contactless transactions, including ensuring proper transaction routing.

3.4 Initiating a Visa payWave Transaction

• During a Visa payWave transaction, consumers briefly hold their Visa payWave card

near the reader when prompted, instead of inserting their card in the reader as with

VSDC transactions or swiping the magnetic stripe. The Visa payWave card is embedded

with an antenna and a chip. The chip, through the antenna, communicates with the

merchant’s contactless reader to enable the transaction.

• Acquirers should be aware that Visa payWave transactions may be initiated not only

from a traditional plastic card but also from other form factors and devices such as Near

Field Communication (NFC) enabled mobile devices and key fobs.

April 2014 VISA CONFIDENTIAL 24

Notice: This information is proprietary and CONFIDENTIAL to Visa. It is distributed to Visa participants for use

exclusively in managing their Visa programs. It must not be duplicated, published, distributed or disclosed, in whole

Visa Smart Debit/Credit and Visa payWave U.S. Acquirer Implementation Guide

3.5 qVSDC Transactions

3.5.1 Preliminary Processing

• Before the card and reader begin their interaction, the transaction amount is typically

received by the reader before it performs its preliminary processing. Preliminary

Processing expedites the transaction by allowing the reader to perform several risk

management steps prior to interacting with the card.

• During Preliminary Processing, the reader may use the transaction amount to perform

the following checks:

• Reader Contactless Transaction Limit: Transactions for amounts above this limit are

terminated and may be processed only by using a different interface.

NOTE: Contactless readers are required to either have the reader contactless transaction

limit disabled or set to its maximum amount. This limit is not used in the U.S. region.

• Reader Cardholder Verification Method (CVM) Limit: Transaction amounts above this

limit require cardholder verification for the contactless transaction.

• Reader Contactless Floor Limit: Transactions above this limit require an online

authorization by the card issuer. For the U.S. region this limit is set to zero or is not

supported to ensure all transactions are sent online to be authorized by the issuer.

• The reader sets the results of these checks in the Terminal Transaction Qualifiers (TTQ),

a reader data element. The TTQ provides the card with the reader’s capabilities and

requirements. For U.S. readers the TTQ must reflect online-only transactions with no

contact transaction limits.

3.5.2 Application Selection

• Once the reader has completed Preliminary Processing, the reader signals to the

consumer that the reader is ready for the contactless card. The cardholder briefly waves

or holds the Visa payWave card close to the contactless reader to initiate the

transaction. The reader determines whether it shares a contactless application with the

card by selecting the card’s list of contactless AIDs (called the Proximity Payment

Systems Environment [PPSE]). If there is an AID in common, that AID is automatically

selected; otherwise the reader terminates the transaction and the transaction may

proceed via another interface such as magnetic stripe or contact chip.

• If there are two or more AIDs in common, the AID with the highest priority is

automatically selected as per EMV Contactless standards. For example, a card may

have both credit and debit AIDs, in which case the issuer or consumer will have defined

one of those AIDs as a higher priority than the other.

NOTE: For qVSDC readers supporting a merchant routing option, a pre-select step as defined

in Section 3.3 may be required to identify the AIDs supported on the card/consumer

device and thereby the possible routing options that are available to the merchant.

Section 4.5.1 provides further information on this issue.

April 2014 VISA CONFIDENTIAL 25

Notice: This information is proprietary and CONFIDENTIAL to Visa. It is distributed to Visa participants for use

exclusively in managing their Visa programs. It must not be duplicated, published, distributed or disclosed, in whole

Visa Smart Debit/Credit and Visa payWave U.S. Acquirer Implementation Guide

3.5.3 Dynamic Reader Limits (Optional)

• Once the application has been selected, readers that support Dynamic Reader Limits

(DRL) examine the Application Program Identifier (Program ID) returned by the

application to determine the applicable reader limits for the transaction.

• When the Program ID returned by the card does not match a reader Program ID (or the

card does not return a Program ID), the reader processes the transaction using the

reader limits and results determined during Preliminary Processing.

3.5.4 Card Request Terminal and Transaction Data

• Once the application is selected, the Visa payWave card responds by requesting

information such as the transaction amount, TTQ, and the reader’s currency code for

use during the transaction. The reader responds with the requested information.

• Figure 1 below provides a processing overview of the card requesting terminal and

transaction data.

Figure 1: Card Requests Terminal and Transaction Data

• The TTQ advises the Visa payWave card of the reader’s requirements and capabilities

for processing the specific transaction as follows:

• Whether it supports qVSDC or MSD as well as whether it supports contact VSDC

• Whether it supports Signature, Online PIN, Offline PIN through the Contact Interface,

and/or Consumer Device CVM

NOTE: A Consumer Device CVM is a CVM that is performed on and validated by the

consumer’s payment device, independent of the reader.

• Whether cardholder verification is required for the transaction

• Whether the reader supports Issuer Update Processing

• In qVSDC transactions, the card uses the information provided in the TTQ to make risk

management decisions before responding to the reader.

April 2014 VISA CONFIDENTIAL 26

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exclusively in managing their Visa programs. It must not be duplicated, published, distributed or disclosed, in whole

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3.5.5 Transaction Terminated

• Rather than decline a transaction needlessly, if a Visa payWave transaction cannot be

completed as a contactless transaction, the contactless transaction is terminated and

may be processed as a physical contact chip or magnetic stripe transaction. If either the

card or the reader decides to terminate the transaction, the transaction is terminated and

the transaction may be completed using another interface (such as contact chip). In

these instances the reader should power down the contactless interface and direct the

cardholder to use the alternate interface.

• Terminated transactions differ from declined transactions because declined transactions

may not be reinitiated. The acquirer’s merchant environment may have specific best

practices or requirements for situations where it is preferred to terminate the transaction

and proceed with a contact interface.

3.5.6 Online Processing

• The reader indicates to the cardholder that the card can be removed from the reader’s

field. The reader uses the information provided by the card and transmits the transaction

to the acquirer.

• The reader sends the data from the transaction including the cryptogram, information

regarding the selected application and the interface used together with standard

transaction data to the acquirer. The acquirer then formats the corresponding VisaNet

authorization message including the relevant data fields. For qVSDC transactions the

following V.I.P. Field values are included:

• Field 22 – POS Entry Mode with a value of 07

• Field 23 – Card sequence number that uniquely identifies the card used to initiate the

transaction

• Field 55 – Including relevant Tags to support the Cryptogram, Form Factor Indicator

(Tag 9F6E) and if present in the card the Customer Exclusive Data (Tag 9F7C)

• Field 60.2 – Terminal Entry Capability with a value of 5 (contact or contact and

contactless chip capable terminal) or 8 (contactless chip capable terminal)

• VisaNet performs processing on the authorization message to determine if the issuer

participates in Visa Chip Authenticate. If not then authorization is sent directly to the

issuer.

• During a qVSDC transaction, the issuer validates the card using CVN 17, CVN 10, or

CVN 18. Based on the results of online card verification, along with other standard risk

management checks (such as ensuring that the card is not expired, and verifying that

the account is in good standing and has available funds), the issuer either approves or

declines the transaction in the authorization response.

April 2014 VISA CONFIDENTIAL 27

Notice: This information is proprietary and CONFIDENTIAL to Visa. It is distributed to Visa participants for use

exclusively in managing their Visa programs. It must not be duplicated, published, distributed or disclosed, in whole

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• The authorization response is sent to the acquirer which logs the response and forwards

the response to the merchant terminal.

3.5.7 Transaction Outcome

• The reader conveys the issuer’s authorization response by displaying whether the

transaction is approved or declined. If approved, depending on Visa rules, the

transaction may not require a cardholder signature or a receipt.

3.6 MSD Transaction Flow

• During an MSD transaction, the consumer briefly holds their Visa card near the

contactless reader, instead of swiping or inserting it. The Visa payWave card is

embedded with an antenna and a chip. The chip, via the antenna, communicates with

the merchant’s contactless reader to conduct the transaction. The card and reader

exchange information in less than a half of a second and the transaction is processed

and completed.

• The transaction follows magnetic stripe processing and rules except that it includes

enhanced online card authentication using CVN 17 or dCVV. Depending on

requirements and rules, transactions below a certain defined value may not require

cardholder verification (signature or online PIN) or a receipt. Regional rules and

requirements define the Cardholder Verification Method for particular transactions.

Acquirers should contact their Visa representative for specific information. The following

sections outline the steps involved in a MSD transaction.

3.6.1 Application Selection

• Unlike qVSDC, MSD readers do not support preliminary processing but otherwise

Application Selection is identical to qVSDC transaction processing as defined in Section

3.5.2.

3.6.2 Card Request Terminal and Transaction Data

• Once the contactless application is selected, the Visa payWave card requests

information from the reader to use during the transaction by sending the Processing

Options Data Object List (PDOL) to the reader. The reader responds with the requested

information.

• The information includes the transaction amount, the reader’s capabilities and

requirements in the Terminal Transaction Qualifiers and other transaction data. The card

uses the TTQ to ascertain the capabilities of the reader including whether the reader

supports MSD CVN 17. After reviewing the TTQ, the card completes its part of the MSD

transaction by sending data to the reader such as the Track 2 data and a CVN 17

cryptogram. The reader then indicates to the cardholder that the card can be removed

from the reader’s field.

• Acquirers must support qVSDC and MSD CVN 17 and continue to support dCVV (MSD

Legacy) until 1 January 2015.

April 2014 VISA CONFIDENTIAL 28

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• After the exchange, the reader prompts the cardholder to remove the card from the

reader’s field.

3.6.3 Online Processing

• The reader sends the data from the transaction including the cryptogram to the acquirer.

If the transaction is to be routed to VisaNet the acquirer then formats the corresponding

VisaNet authorization message including the relevant data fields. For MSD transactions

the following V.I.P. Field values are included:

• Field 22 – POS Entry Mode with a value of 91.

• Field 23 – Card sequence number that uniquely identifies the card used to initiate the

transaction (If personalized on the card this field must be present in the authorization

message)

• Field 55 – Including relevant Tags to support the Cryptogram, Form Factor Indicator

(Tag 9F6E) and if present in the card the Customer Exclusive Data (Tag 9F7C)

• Field 60.2 – Terminal Entry Capability with a value of 8 (contactless chip capable

terminal)

NOTE: For MSD transactions where a dCVV (MSD Legacy) card was used, Field 23

and Field 55 will not be sent in the authorization message.

• VisaNet performs processing on the authorization message to determine if the issuer

participates in Visa Chip Authenticate. If not then the authorization request message is

sent directly to the issuer.

• The issuer (or Visa, on the issuer’s behalf) performs enhanced online card

authentication using CVN 17 or validates the dCVV if a legacy card was used. The

authorization response is determined by the cryptogram results along with other

standard risk management checks such as checking the cardholder’s Online PIN, if

applicable, ensuring that the card is not expired, and making sure that the account is in

good standing and has available funds. The issuer sends the authorization response to

the reader.

3.6.4 Transaction Outcome

• The acquirer formats the issuer response and forwards it to the terminal. The terminal or

reader conveys the issuer’s authorization response by displaying whether the

transaction is approved or declined. If approved, depending on Visa rules, the

transaction may not require a cardholder signature or a receipt.

• If the transaction is approved, it is later submitted as part of clearing and settlement.

April 2014 VISA CONFIDENTIAL 29

Notice: This information is proprietary and CONFIDENTIAL to Visa. It is distributed to Visa participants for use

exclusively in managing their Visa programs. It must not be duplicated, published, distributed or disclosed, in whole

Visa Smart Debit/Credit and Visa payWave U.S. Acquirer Implementation Guide

3.7 Visa payWave for Mobile

• Visa payWave for mobile brings the contactless payment experience to the mobile

device through support of the Visa Mobile Contactless Payment Specification (VMCPS).

The Visa payment application developed to VMCPS is called Visa Mobile Payment

Application (VMPA).

• From the acceptance perspective, mobile devices containing a VMPA can be accepted

in any version of contactless readers that are developed to different versions of the Visa

Contactless Payment Specification (VCPS); for instance Version 2.1 including all

published updates and EMV Contactless Kernel 3. Visa payWave transactions that

originate from mobile devices have the same processing requirements as Visa payWave

transactions that originate from cards. There is no difference between a card and a

mobile Visa payWave transaction from the point of view of the transaction processing,

authorization, and settlement data that is passed through V.I.P. and BASE II systems.

•

April 2014 VISA CONFIDENTIAL 30

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Visa Smart Debit/Credit and Visa payWave U.S. Acquirer Implementation Guide

4 Visa’s Chip Terminal and Reader Requirements

• This Section describes the requirements for deploying EMV-compliant Visa Smart

Debit/Credit (VSDC) terminals and Visa Contactless Payment Specification (VCPS)-

compliant contactless readers. These are terminals and readers that meet the security,

interoperability and functionality requirements outlined in the EMV Specifications, VCPS

and comply with Visa’s terminal requirements.

• The focus is on requirements for online-only terminals. Some of the functions discussed

in Section 2 and Section 3 relating to VSDC and VCPS processing are not covered in

the following sections as they do not require action by acquirers and should be built into

EMV-compliant terminals. Acquirers considering support for offline processing, for

example, support for offline authorization, should review the global VSDC Acquirer

Implementation Guide.

• An overview of each function requiring action by acquirers is provided in the following

sections. Further details can be found in the EMV Specifications, VCPS and in the Visa

Transaction Acceptance Device Requirements. Acquirers should work with vendors to

outline the support vendors will provide and the activities that should be handled

internally by acquirers.

4.1 Terminal Types

• A number of different terminal types are defined in the EMV Specifications as outlined in

the table below. Depending on the nature of the merchant, its location and profile,

acquirers can determine which type better supports the merchant’s requirements.

Selection of the type is also dependent on the nature of the domestic market.

• The U.S. market is a zero floor-limit market, meaning all transactions need to be

authorized online by the card issuer in order to protect the acquirer from liability.

Therefore, it is expected that most U.S. acquirers and merchants will deploy online-only

terminals and not offline capable terminals.

• Acquirers may deploy terminals that are offline capable but any offline processing is at

the acquirer’s risk and accordingly may increase its liability. Acquirers considering this

option should review the global VSDC Acquirer Implementation Guide requirements for

offline capable terminals.

Table 1: EMV and VSDC Terminal Types

YPE

ESCRIPTION

Offline/online

terminals Capable of processing both offline and online transaction authorization.

For example, an online capable terminal with a floor limit above zero will

execute both offline and online transactions.

April 2014 VISA CONFIDENTIAL 31

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YPE

ESCRIPTION

Online-only

terminals Cannot approve transactions offline. For authorization processing, the

transaction must be sent online to the issuer. These terminals may,

however, decline transactions offline. For example, under EMV, ATMs

are considered online-only terminals.

It is expected that most U.S. acquirers will deploy online-only terminals

since all transactions in the U.S. need to be authorized online.

Online-capable

terminals Includes online-only terminals, as well as offline/online terminals.

•

NOTE: Offline PIN processing is not directly related to online or offline authorization.

For example, offline PIN processing may be performed for online authorized

transactions.

4.2 Application Identifiers (AIDs)

• The terminal must contain the Application Identifiers (AIDs) for all chip payment

applications that it supports. If the terminal cannot match one of its AIDs with an AID

from the card, a chip transaction cannot be completed. The AID consists of two

components:

• Registered Application Provider Identifier (ISO RID) – indicates the payment system.

Visa owned RIDs are:

o The Visa ISO RID is A000000003

o The Visa US Common Debit RID for debit and prepaid products covered by the

unaffiliated network requirements of the Dodd-Frank Act and Federal Reserve

Board Regulation II is A000000098

• Proprietary Application Identifier Extension (PIX) – indicates the application.

o The Visa globally interoperable PIXs are listed in Section 4.2.1

• The AIDs used for Visa globally interoperable cards use the Visa ISO RID and are

outlined in the following:

• Table 2: Application Identifiers (AIDs) for Visa ISO RID by product type.

• The PIX used to define the Visa US Common Debit AID is listed in Table 3: Application

Identifier (AID) for Visa US Common Debit AID.

• The AID used for debit and prepaid products covered by the unaffiliated network

requirements of the Dodd-Frank Act and Federal Reserve Board Regulation II is defined

in Table 3: Application Identifier (AID) for Visa US Common Debit AID.

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4.2.1 Visa AIDs

• The AIDs used for Visa globally interoperable cards uses the Visa ISO RID and are

outlined below.

Table 2: Application Identifiers (AIDs) for Visa ISO RID

PPLICATION

RID

PIX

Visa (e.g., Visa Credit or Visa Debit) A000000003 1010

Visa Electron A000000003 2010

Visa Interlink A000000003 3010

PLUS A000000003 8010

•

4.2.2 Visa US Common Debit AID

• The AID used for debit and prepaid products covered by the unaffiliated network

requirements of the Dodd-Frank Act and Federal Reserve Board Regulation II is defined

below.

Table 3: Application Identifier (AID) for Visa US Common Debit AID

APPLICATION RID + PIX

Visa US Common Debit A000000098 0840

•

4.2.3 Rules for Visa AIDs

• An Application Selection Indicator associated with each terminal AID designates whether

the terminal AID must exactly match the card AID or whether the terminal AID may

match only the first portion of the card AID (partial selection). For Visa AIDs, this

indicator must be set to allow partial selection.

• All terminals accepting Visa must support the Visa AID.

• All POS contact chip terminals that contain the Visa AID must also contain the Visa

Electron AID if the merchant accepts Visa Electron magnetic stripe cards.

• All POS terminals accepting Visa Interlink must support the Visa AID, Visa Interlink AID

and the Visa US Common Debit AID.

• Acquirers should take care in using the AIDs listed above. Terminals must not use only

the Visa ISO RID (i.e. without a PIX) with Partial AID Selection for Application Selection

as some cards may contain ISO RID+PIX combinations for domestic applications that

are not valid in other countries.

April 2014 VISA CONFIDENTIAL 33

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• Note that in addition to the AIDs beginning with the Visa ISO RID, Visa cards may

contain one or more non-Visa AIDs – some AIDs may represent specific network or

routing options, others may be for non-payment functions or domestic applications from

another country.

• Note that ATMs may have different rules for presence of AIDs.

4.2.4 Implementation Activities

• Acquirers should determine which AIDs to support in their terminals depending on the

card programs accepted.

• If a merchant accepts Visa cards, they must support the Visa AID.

• Online capable terminals must also support the Visa Electron AID.

• If a merchant accepts Visa Interlink cards, they must support the Visa AID, the Visa

Interlink AID, and the Visa US Common Debit AID. Visa Interlink can only be accepted

at terminals capable of processing online transactions with online PIN verification.

4.3 Language

• Acquirers must decide the languages their terminals will offer to customers. EMV-

compliant terminals may display messages in multiple languages. At least one language

must be supported.

4.3.1 Implementation Activities

• Acquirers should ensure that terminals always display messages in English. If customers

in specific locations speak other languages or are frequented by international visitors,

acquirers may want to consider support for additional languages.

4.4 VSDC Requirements

• The following sections outline the requirements relating to acceptance of contact chip

VSDC cards. Requirements relating to acceptance of Visa payWave cards are outlined

in Section 4.5 Visa payWave Reader Requirements.

4.4.1 Contact EMV Application Selection

• When a VSDC card is presented to a terminal, the terminal determines which

applications are supported by both the card and terminal by comparing the Application

Identifiers (AIDs) on the card with the AIDs maintained by the terminal. The terminal

builds a list of the applications jointly supported by the card and terminal using either the

Directory Selection Method or the List of AIDs Method. Support for the Directory

Selection Method is optional for the card and terminal, while the List of AIDs Method is

mandatory.

April 2014 VISA CONFIDENTIAL 34

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• If both the card and terminal support the Directory Selection Method, the terminal reads

a list of the payment applications maintained on the card from the Payment Systems

Environment (PSE) file. The terminal compares the applications listed in the card PSE to

the applications it supports and builds the Candidate List, which is the terminal's internal

list of applications jointly supported by the card and terminal. If the card does not have a

PSE or the terminal does not support the Directory Selection Method, the terminal uses

the List of AIDs Method.

• With the List of AIDs Method, the terminal goes through its list of applications and asks

the card whether it also has the application. Common applications are put on the

Candidate List created by the terminal.

• Further information regarding both methods can be found in the EMV Specifications.

Additional information on application selection when the Visa US Common Debit AID is

present can be found in Section 4.4.3.

4.4.1.1 Implementation Activities

• The List of AIDs Method is mandatory and is supported by all terminals. All contact

EMV-compliant terminals include this functionality.

• Because the Directory Selection Method is optional, acquirers should evaluate its

benefits for the domestic environment. If either or both of the following factors are true,

acquirers may want to support the Directory Selection Method in addition to the List of

AIDs Method:

• If domestic issuers are planning to support the Directory Selection Method on their

cards; it will only be used when both the card and terminal support it. Otherwise, the

List of AIDs Method will apply.

• If the acquirer’s terminal supports many applications, increased efficiency may be

realized when the Directory Selection Method is implemented.

• Terminal vendors will cover development of application selection, so no internal

technical resources are required. If the Directory Selection Method is controlled by a

predefined parameter, acquirers should ensure that the Terminal Management System

accommodates that parameter.

4.4.2 Cardholder Application Selection/Confirmation

• Visa strongly recommends that merchants and acquirers implement cardholder

application selection at acceptance terminals so that cardholders can choose their

desired application for a transaction when their card supports more than one application.

NOTE: If a cardholder selects an AID to be used for the transaction then the transaction must

be processed using the selected AID unless the cardholder confirms that they accept a

different AID to be used. If a Visa AID that begins with the Visa ISO RID as defined in

Section 4.2.1 is selected, the transaction must be routed to VisaNet. An acceptance

terminal may support cardholder application selection by either of the following two

April 2014 VISA CONFIDENTIAL 35

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methods when the acceptance terminal and the card support more than one

application in common

• The acceptance terminal displays all of the commonly supported applications to the

cardholder at once in the priority sequence specified by the issuer (recommended), or

• The acceptance terminal displays each commonly supported application to the

cardholder, one-by-one in the priority sequence specified by the issuer, and allows the

cardholder to confirm the displayed application or to advance to the next application.

• If more than one AID is mutually supported by the card and the terminal and the AID is

not chosen by the cardholder or the issuer, the terminal must clearly communicate the

selected application label of the AID to the cardholder.

• Further information regarding Application Selection can be found in Section 4.4.3 and

the EMV Specifications and the Visa Transaction Acceptance Device Guide.

4.4.2.1 Implementation Activities

• Visa strongly recommends that cardholder selection be implemented as some issuers

may require cardholder confirmation. If the acceptance terminal does not support this

function, it may not be possible to perform the transaction.

4.4.3 Contact Application Selection and Routing Options

To provide for multiple transaction routing options (as required for debit and prepaid

products covered by the unaffiliated network requirements of the Dodd-Frank Act and

Federal Reserve Board Regulation II), more AIDs may be present on a Visa card. When a

transaction is performed using an AID that begins with the Visa ISO RID as defined in

Section 4.2.1, then the transaction must be routed to Visa. (The application associated with

the Visa ISO RID AID is often simply referred to as the “Visa AID” to distinguish it from the

Visa US Common Debit AID.) Additional routing options may be supported by the presence

of the Visa US Common Debit AID or one or more non-Visa owned AIDs on the card, each

representing a different product with their own routing options.

NOTE: Not all Visa cards will support multiple AIDs, as some products will not support multiple

routing options. The presence of multiple AIDs in itself is not an indication that multiple

routing options are supported by the card, as the non-Visa AIDs could be non-payment

related or may relate to a non-US domestic payment system.

NOTE: Visa cards that support multiple AIDs, of which one supports multiple routing option(s)

for debit and prepaid, may also include a separate AID for a product that is not

covered by the Dodd-Frank Act and Federal Reserve Board Regulation I – for instance

a multi-application card with both credit and debit AIDs.

• As a result, merchants that prefer to determine the network to which a transaction is

routed will need to deploy specific logic in their terminals to ensure that the AID

corresponding to their preferred network is selected (otherwise the cardholder selection

or the hierarchy the issuer has specified on the card will determine the AID and

corresponding routing of the transaction).

April 2014 VISA CONFIDENTIAL 36

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• For terminals supporting Cardholder Application selection (see Section 4.4.2), there is

no need for any special logic as it will be the cardholder choice that defines the routing.

The Cardholder will choose an AID and thereby the possible networks to which the

transaction can be routed via the Application Label displayed during the Cardholder

Application Selection process.

• However for terminals not offering Cardholder Application selection, the terminal will

need to have a defined process to select amongst the AIDs present on the card and

have the result of the selection process be communicated to the cardholder.

• In general for terminals not offering Cardholder Application selection, the Application

Priority Indicator returned by the card for each AID should be used to decide a specific

routing option by selecting the AID having an Application Priority Indicator with the

highest priority.

• If a terminal does not offer Cardholder Selection or does not use the Application Priority

Indicator method, as described in Appendix D Standard EMV Terminal Logic, the

terminal must include specific logic to determine the AID and routing. This logic and the

process for determining the AID is as defined in Appendix E.1 Contact Terminal

Application Selection/Routing Option Logic. For such terminals, it is necessary to

understand whether the card product represented by an AID allows the merchant to

control the transaction routing.

• For terminals connected to acquirer networks, where the acquirer processor decides the

routing option, the terminal may need to transport to the acquirer some indication of the

selected AID (for example the AID itself) to be able to recognize routing limitations as

defined by the selected AID (e.g., for a Visa AID that begins with the Visa ISO RID as

defined in Section 4.2.1).

NOTE: It is important to communicate to the cardholder the Application Label selected,

otherwise the cardholder may wrongly assume what rights and benefits are available

for the transaction. Chargeback rights, rewards and sweepstakes entry are examples

of the rights and benefits cardholders may expect to receive as part of their banking

relationship. These benefits and rewards may differ depending on the selected AID

and routing option. If these rights and benefits are expected by the cardholder but are

not honored by the merchant, consumer dissatisfaction with the payment experience at

that merchant may result.

4.4.3.1 Implementation Activities

• As outlined in Section 4.4.2.1, Visa recommends that acquirers and merchants support

cardholder selection in which case routing options will follow cardholder selection and

eliminate the need for special terminal logic.

April 2014 VISA CONFIDENTIAL 37

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• If the terminal does not offer Cardholder Selection or apply Application Priority Indicator

as described in Appendix D Standard EMV Terminal Logic, the acquirer may need to

request the terminal vendor to support the logic as described in Appendix E.1 Contact

Terminal Application Selection/Routing Option Logic. Also the acquirer needs to ensure

that terminals are equipped to determine whether a specific product allows the merchant

to control the transaction routing. In order to make this determination, the acquirer will

need to receive an indication of which AID was selected at the terminal.

4.4.4 Processing Restrictions

• The terminal performs Processing Restrictions to see whether the transaction should be

allowed. The terminal checks whether the effective date for the card has been reached,

the card has not expired, the application versions of the card and terminal match, and if

any Application Usage Control restrictions are in effect. An issuer may use Application

Usage Controls to restrict a card’s use for domestic or international transactions, as well

as cash, goods and services or cash-back.

• Processing Restrictions is a mandatory feature in EMV and must be performed by all

terminals. Further information about processing restrictions may be found in the EMV

Specifications.

4.4.4.1 Implementation Activities

• Acquirers do not need to undertake any specific activities relating to Processing

Restrictions. They should ensure that their terminal vendor has loaded the correct

Application Version Number in the terminal, which corresponds to the most current

version of VIS.

4.4.5 Cardholder Verification

• Cardholder verification is used to ensure that the cardholder is legitimate and the card

has not been lost or stolen. The terminal uses a CVM List from the card to determine the

type of verification to be performed, for example, signature or online PIN. The CVM List

establishes a priority of CVMs to be used relative to the capabilities of the terminal and

characteristics of the transaction.

• Certain terminal types, as defined by Visa (e.g., ATMs), require an online PIN entry even

when the card’s CVM List does not include it. The table below lists the most common

types of CVMs supported by terminals in the U.S. market. Acquirers may also determine

whether support for other EMV provided CVMs, for example, offline PIN, would be

advantageous.

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Table 4: Types of Cardholder Verification Methods

CARDHOLDER

VERIFICATION METHOD DESCRIPTION

Signature Normally, operates in the same manner as in the magnetic stripe

environment. The cardholder signs the transaction receipt and

the merchant compares this signature to the signature on the

card. Signature support may be implemented by selecting the

Visa AID (see Appendix D) or via special processing (see

Appendix E)

Online PIN Operates in the same manner as in the magnetic stripe

environment. The cardholder-entered PIN is encrypted by the

terminal and is sent online to the issuer for verification.

No CVM Required Operates in the same manner as in the magnetic stripe

environment where transaction authorization is independent of

cardholder verification. No cardholder verification is currently

allowed for low value transactions in some merchant

environments, such as certain unattended terminals, quick

service restaurants and qualifying VEPS transactions.

Fail CVM Processing This is a catch-all option to ensure CVM processing is deemed to

have failed. EMV requires that this CVM is always supported.

• From a VSDC perspective, it is mandatory that terminals perform Cardholder Verification

by reviewing the card’s CVM List, if present, to determine the verification method for the

transaction.

• The specific CVMs supported by terminals are based on business needs, types of card

programs accepted and Visa mandates. The following general guidelines are provided to

assist acquirers to determine the types of CVMs to support at their POS terminals1.

• Signature must continue to be supported as the default for international Visa and Visa

Electron card transactions, as well as domestic transactions (except for Visa Interlink

and Unattended Cardholder Activated Terminals (UCATs)). Signature support may be

implemented by selecting the Visa AID (see Appendix D) or via special processing (see

(see Appendix E).

• Online PIN for chip transactions is not mandatory for POS, but may be necessary where

the terminal already supports online PIN verification to preserve support of existing

programs.

• Dual-interface terminals that support online PIN for contact chip should also support

online PIN for contactless transactions.

• Card acceptance terminals need to support a minimum level of cardholder verification,

as determined by Visa.

1 Note that for ATMs, there are different guidelines for CVM

April 2014 VISA CONFIDENTIAL 39

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• Transactions that qualify under the VEPS program do not require cardholder verification

unless required under Visa rules. Acquirers should refer to the Visa International

Operating Regulations for requirements relating to VEPS including transaction value

limits.

4.4.5.1 CVM List Processing Exceptions

• Terminals need to support a minimum level of cardholder verification, as determined by

Visa or by law, even when the card does not support CVM processing, no CVM List is

present, or the last CVM processed in the CVM List is No CVM Required. If CVM

processing does not result in the required CVM, the terminal may additionally perform

the default CVM designated in the Visa Operating Regulations or in law for the terminal

and transaction type. This may be accomplished through use of selectable kernels or, in

some cases, code outside of the kernel.

• Alternatively, if the terminal determines that CVM Processing has failed (for example,

when the cardholder is unable to enter a PIN and the CVM list only supports PIN entry),

the transaction is sent online and the issuer responds with an approval, Visa

recommends that:

• The terminal prints a signature line on the receipt, and

• The terminal prompts the merchant to request a signature.

• If a specific CVM is required for certain transactions (e.g., cash-back or low value

transactions), the EMV concept of selectable kernels can be used to suppress certain

CVMs for a specific transaction. See Section 4.4.6 for further details.

NOTE: Merchants should carefully consider the impact of using the selectable kernel feature,

which could lead to PIN being the only option offered to a cardholder. Some

cardholders may be unable to enter the PIN at the POS terminal, or unwilling to do so

due to security concerns or certain disabilities. Terminals may therefore need to

support functionality that allows merchants to offer an alternative CVM for such

cardholders in accordance with merchant protection and local, state or federal disability

legislation. This functionality may, in effect, reverse the logic of the selectable kernel

for such situations.

4.4.5.2 Implementation Activities

• Acquirers need to determine the CVMs to implement at the terminal level, based on Visa

applicable requirements. Some other factors acquirers should consider include:

• If an acquirer decides to implement signature and PIN, Visa recommends that the

terminal omit printing of the signature line on those transactions that are PIN-based and

instead print “Verified by PIN” or “PIN verified” in place of the signature line. In addition,

acquirers should educate merchants to expect that the CVM will vary among

transactions and the terminal will prompt some cardholders for a PIN and others for a

signature.

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• PIN Entry Devices (PEDs) or PIN pads must conform to PCI PIN Transaction Security

(PTS) requirements. If the PED has been integrated with the card-reading terminal, the

entire terminal must meet the security requirements. Refer to Section 6.5 Payment Card

Industry Requirements.

4.4.6 Cardholder Verification and Selectable Kernels

• In order to support the use of Cardholder Verification methods that vary based on

transaction characteristics, it is necessary for a terminal supporting cash-back or the

VEPS program to support Selectable Kernel processing (see Section 8.4.2 Configurable

and Selectable Kernels). This process ensures that the appropriate CVM is requested

for the transaction, by invoking a terminal kernel that only supports the CVM appropriate

to the transaction. The principle in using selectable kernels for Cardholder Verification is

outlined in Appendix E Contact CVM Processing and Selectable Kernels Logic.

4.4.6.1 Implementation Activities

• Acquirers supporting cash-back or VEPS need to ensure that their terminals support

selectable kernels and that they can be configured to support the necessary CVM

selection for a specific transaction.

4.4.7 Terminal Risk Management

• Terminal Risk Management consists of a series of checks to protect the acquirer, issuer

and system from potential fraud. The nature of online-only terminals means that all

transactions have to be approved by the issuer and the functions in Terminal Risk

Management are not necessary.

• Acquirers may consider supporting Floor Limit checking although the U.S. is a Zero

Floor Limit market, which results in all transactions going online. If Floor Limits are

supported, to provide maximum flexibility, Visa suggests that acquirers set up devices to

support the following limits, even if the values for magnetic stripe and chip transactions

are currently the same:

• International Floor Limit for magnetic stripe transactions

• International Floor Limit for chip-initiated transactions

• Domestic Floor Limit for magnetic stripe transactions

• Domestic Floor Limit for chip-initiated transactions

4.4.8 Terminal Action Analysis

• Terminal Action Analysis is mandatory and uses the results of Processing Restrictions,

Terminal Risk Management, and Cardholder Verification, as well as rules set in the card

and terminal, to determine whether the transaction should be approved offline, sent

online for authorization, or declined offline.

April 2014 VISA CONFIDENTIAL 41

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• After determining the disposition of the transaction, the terminal requests an Application

Cryptogram from the card, corresponding to the transaction disposition:

• Authorization Request Cryptogram (ARQC) – Online authorization

• Application Authentication Cryptogram (AAC) – Offline decline

• The card rules are set in Issuer Action Codes (IACs) fields, which are read by the

terminal from the card. The Visa rules are stored in the terminal as Terminal Action

Codes (TACs).

• Issuer Action Codes (IACs): Card-based rules the terminal uses during terminal action

analysis. IAC values are defined by the issuer and stored in the card. There are three

types of IACs: IAC – Denial, IAC – Online, and IAC – Default.

• Terminal Action Codes (TACs): Terminal-based rules for Terminal Action Analysis. TAC

values are mandated by Visa and must be supported. There are three types of TACs:

TAC – Denial, TAC – Online, and TAC – Default. The Visa TACs are defined in the Visa

Transaction Acceptance Device Requirements.

• An online-only terminal always attempts to go online with the authorization request,

unless declined offline due to IAC – Denial settings. During IAC – Denial and TAC –

Denial processing, if a Terminal Verification Results (TVR) bit is set and the

corresponding IAC – Denial or TAC – Denial bits are set (or it is set in both), the

terminal declines the transaction. The only relevant TAC setting for a transaction at an

online-only terminal is “Service not allowed.”

• An online-only terminal may perform or omit IAC – Online and TAC – Online processing

and IAC – Default and TAC – Default processing. For IAC – Online and TAC – Online

processing, if performed, the only relevant TVR setting for an online-only terminal is

“Transaction value exceeds the floor limit.”

• Because the floor limit is set to zero, the transaction always goes online and all other

values in TAC – Online or IAC – Online are irrelevant. The IAC – Default and TAC –

Default processing, if performed, will always cause a transaction to be declined if an

online authorization could not be performed.

• Visa recommends that online-only terminals do not perform IAC – Online and TAC –

Online processing, as all transactions are sent online for approval. If the terminal is

unable to go online, the terminal may either:

• Approve the transaction at the acquirer/merchant’s risk and subsequently perform a

deferred authorization.

• Request an AAC to decline the transaction and notify the cardholder that the service

cannot be performed due to a communication failure.

• If the terminal and card determine that the card was to be declined offline, the

transaction is not sent online and the card generates an AAC.

April 2014 VISA CONFIDENTIAL 42

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• For transactions initiated with the Visa US Common Debit AID, the same online only

terminal action analysis principles apply. The terminal may omit TAC/IAC-Online and

TAC/IAC-Default processing, eliminate the associated TAC-Online and TAC-Default

values, and always request to go online with an ARQC. However, if TAC/IAC-Online or

TAC/IAC-Default processing is performed, the TAC-Online and TAC-Default values must

be 0xFFFFFFFFFF.

4.4.9 Implementation Activities

• Acquirers should ensure that terminal vendors have loaded the Visa TACs correctly.

Information regarding the TACs should also be provided to merchant service and

technical areas to ensure they are used when troubleshooting or reviewing terminal

problems.

4.4.10 Online Processing

• The outcome of Terminal Action Analysis (and corresponding Card Action Analysis) will

be for the transaction to be sent online or declined offline. If the transaction is to be sent

online, the card returns a set of data including the Authentication Request Cryptogram

(ARQC) which will be used by the issuer to determine whether the transaction is coming

from a valid card.

4.4.10.1 Implementation Activities

• Acquirers need to determine the requirements for sending transactions online. Further

information regarding the authorization message requirements can found in Section 9:

Acquirer System Changes.

4.4.11 Completion

• The card and terminal perform final processing to complete the transaction.

• When the online authorization is successfully completed, a final Application Cryptogram

is generated by the card. The card uses the transaction disposition, Issuer

Authentication results and issuer-encoded to determine whether to return a TC or an

AAC.

• Although terminals are not required to retain the cryptogram (TC or AAC) for online-

approved transactions at single-message (SMS) or host-capture terminals, the terminal

must request the final cryptogram to allow the chip card to complete Issuer

Authentication to avoid unnecessary online requests during subsequent POS

transactions.

• A reversal must be generated for online approved transactions that are subsequently

declined by the card.

April 2014 VISA CONFIDENTIAL 43

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• For terminal-capture terminals, the terminal transmits the TC and the related cryptogram

data in the clearing message. SMS and host-capture acquirers may transmit the ARQC

and the related cryptogram data in the clearing message, if the authorization code

returned by the issuer is included.

• If during processing the terminal needs to terminate the transaction, the terminal must

display a message to the cardholder and merchant indicating why the transaction cannot

be completed and that the card should be removed.

4.4.12 Implementation Activities

• Acquirers need to determine the requirements for transmitting or storing the final

Application Cryptogram especially if they are considering supporting offline transactions.

• Acquirers should also review changes required to reverse a transaction when the card

declines the transaction after the issuer has approved it.

NOTE: For submitting offline clearing transactions see Section 9.3 Host System Changes.

4.5 Visa payWave Reader Requirements

4.5.1 Application Selection and Routing Options

• To provide for multiple transaction routing options on debit and prepaid products covered

by the unaffiliated network requirements of the Dodd-Frank Act and Federal Reserve

Board Regulation II, more AIDs may be present on a Visa payWave enabled product.

When a transaction is performed using an AID that begins with the Visa ISO RID as

defined in Section 4.2.1, the transaction must be routed through Visa. Additional routing

options may be supported by the presence of the Visa US Common Debit AID or one or

more non-Visa owned AIDs on the consumer device, each representing a different

routing option. Alternatively additional routing options may be supported via use of the

contact chip or physical magnetic stripe of a contactless card.

• Contactless transactions do not support Cardholder Application Selection in the same

way as contact chip transactions due to the minimal interaction between the contactless

reader and the consumer device. Instead the reader will always select the highest

priority AID on the consumer device.

• Merchants that prefer to control the network to which a transaction is routed will need to

deploy specific logic in their readers/terminals to ensure that the AID corresponding to

their preferred network is selected. Since contactless application selection – again due

to the short interaction between reader and card – does not have a special "elimination

process" for AIDs, the special logic needs to take place before the standard contactless

application selection process begins. The special logic necessary to provide merchant

reader control over AID selection does not impact the standard contactless kernel, but

will take place in a separate reader application executed before the normal contactless

transaction flow begins. The logic for such a "pre-select" reader application is as defined

in Appendix E Contactless Reader Application Selection and Routing Option Logic.

April 2014 VISA CONFIDENTIAL 44

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• Only readers that are not using the standard application selection process (based on

Application Priority Indicator) need the special logic.

• For such terminals, it is necessary to understand whether the card product represented

by an AID is eligible for merchant controlled routing. If so, this can be achieved by

maintaining a BIN-table/routing table on the terminal or within the merchant system, or

by asking the cardholder for an indication of the chosen product (e.g., via a dedicated

button on the terminal).

• For terminals connected to acquirer networks where the acquirer processor decides the

routing option, the terminal must transport to the acquirer sufficient information for the

acquirer to perform the actual routing (for example the AID used for a qVSDC

transaction).

NOTE: It is important to communicate to the cardholder the Application Label selected,

otherwise the cardholder may wrongly assume what rights and benefits are available for

the transaction. Chargeback rights, rewards and sweepstakes entry are examples of the

rights and benefits cardholders may expect as part of their banking relationship. These

benefits and rewards may differ depending on the selected AID. If these rights and

benefits are expected by the cardholder but are not honored by the merchant, consumer

dissatisfaction with the payment experience at that merchant may result.

4.5.2 Transaction Speed

• Visa payWave transactions are designed to be fast. Interaction between the card and

the reader for both MSD and qVSDC must not exceed 500 milliseconds.

NOTE: The 500-millisecond requirement is for "card-in-field" time, and does not include qVSDC

preliminary processing nor any processing after the reader has indicated that card read

is complete.

4.5.3 Terminal Transaction Qualifiers

• The Terminal Transaction Qualifiers (TTQ) is a data element provided by the terminal to

the card during Preliminary Processing. The card uses this information to understand the

terminal’s capabilities and requirements in deciding how to process the transaction.

• For qVSDC, the TTQ indicates:

• Whether the reader supports qVSDC.

• Whether the reader supports EMV contact chip.

• Whether the reader supports online processing.

• Whether the reader requests online processing.

• The Cardholder Verification Methods supported by the reader. This information can

either be the same for all transactions or be dynamically set on a transaction-by-

transaction basis.

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• Whether a CVM is required for the specific transaction.

• Whether the reader supports Issuer Update Processing.

• For the detailed layout of the TTQ, refer to VCPS.

• For MSD, the TTQ should indicate support for MSD and CVN 17 if the acquirer has

migrated and can support CVN 17 data. If the acquirer has not migrated and cannot

support CVN 17 data, this data element should not be set. (CVN 17 support is indicated

by setting the bit associated with “online cryptogram required.”) The TTQ does not

change based on the transaction. No other TTQ settings are required.

• The TTQs are defined by VCPS as a 4 byte field and acquirers need to ensure their

terminals are passing all 4 bytes to ensure issuers are able to process the transaction

correctly. Failure to do this may lead to interoperability problems.

4.5.4 Reader Limits – qVSDC

• The qVSDC reader performs preliminary processing to expedite the transaction. The

reader compares the transaction amount against one or more of the following limits:

• Reader Contactless Floor Limit: for U.S. region this limit is set to zero to ensure all

transactions are authorized by the issuer.

• Reader Cardholder Verification Method (CVM) Limit: transactions for amounts above

this limit require cardholder verification.

4.5.5 Reader Cardholder Verification Method – qVSDC

• The card and terminal work together to determine the cardholder verification requirement

for each transaction. On a qVSDC contactless transaction, the cardholder (or consumer

using a mobile device) is either able to complete the transaction without cardholder

verification or the cardholder provides a signature, enters an online PIN or enter a

passcode on his or her mobile phone.

• Step 1 – The reader determines if cardholder verification is required and provides CVMs

it supports to the card.

• The reader determines whether it requires cardholder verification for the transaction by

checking the transaction amount against the Reader CVM Limit. If the transaction

amount is above this limit, the reader requires cardholder verification; if it is below the

limit, the reader does not require cardholder verification. It also provides the card with

the reader-supported CVMs (signature, online PIN, No CVM) in the TTQ.

NOTE: Support for the Consumer Device CVM by the reader is required for readers supporting

VCPS 2.1 including all published updates.

• The reader has two approaches for providing the Cardholder Verification Methods it

supports to the card in the TTQ:

April 2014 VISA CONFIDENTIAL 46

Notice: This information is proprietary and CONFIDENTIAL to Visa. It is distributed to Visa participants for use

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• The reader can provide the card with all the Cardholder Verification Methods it supports.

This is the simplest approach.

• The reader can tailor the Cardholder Verification Methods to each transaction. For

example, the device might accept No CVM for transactions below a specific amount

while requiring an Online PIN for specific transaction types (e.g., cash-back).

• Acquirers and merchants should be aware of these approaches when selecting a reader

as this may require additional vendor development.

• Note that signature support may be implemented by selecting the Visa AID see

(Appendix D) or via special processing (see Appendix E).

• Step 2 – Card determines if cardholder verification is required.

• The card reviews the TTQ. If the reader requires cardholder verification, the card cannot

override this. If the device does not require cardholder verification, the card determines

whether to require cardholder verification.

• Step 3 – If CVM is required, the card determines which CVM to use.

• If cardholder verification is required, the card reviews the CVMs supported by the device

and compares these methods to the ones it supports. If there is only one CVM in

common, the card selects that CVM. If there is more than one common CVM, the card

selects the first common CVM based on a predefined hierarchy/priority of contactless

CVMs. The CVM hierarchy is shown in order below:

• Online PIN

• Consumer Device CVM (only for mobile phones)

• Signature

• Step 4 – Card communicates CVM selection to reader.

• If a CVM is required, the card indicates the selected CVM to the reader in the Card

Transaction Qualifiers (CTQ).

4.5.6 Reader Cardholder Verification Method – MSD

• The terminal determines the cardholder verification requirement as per magnetic stripe

processing rules. The cardholder may be validated using one of the following methods:

• No cardholder verification. The cardholder does not have to sign the receipt or provide a

PIN. Some Visa environments allow transactions below a specific amount to take place

without cardholder verification.

• Signature

• Online PIN

April 2014 VISA CONFIDENTIAL 47

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4.5.7 Expiration Date Check

• During a contactless transaction, the reader checks the expiration date in the Track 2

Equivalent Data to ensure that the contactless application is not expired. If the card is

expired, the reader declines the contactless transaction.

4.5.8 Online Card Verification

• Full-chip data acquirers must support either Cryptogram Version Number 17,

Cryptogram Version Number 10, or Cryptogram Version Number 18 for online card

verification of qVSDC transactions.

• Acquirers must support the data associated with CVN 17 in authorization messages for

online card verification of MSD transactions. Acquirers must also continue to support

dCVV (MSD Legacy) until 1 January 2015.

NOTE: MSD supports CVN 17, which is supported in qVSDC. CVN 10 and CVN 18 do not apply

to MSD.

NOTE: Regardless of the cryptogram type supported all chip data must be sent in Field 55 of

the authorization message.

4.6 Additional Requirements for VCPS 2.1

• In addition to the requirements listed in Section 4.5 Visa payWave Reader

Requirements, VCPS 2.1 introduces additional functionality which acquirers need to

consider. These additional items are listed in the sections below. For further details,

acquirers should refer to VCPS 2.1 including all published updates.

4.6.1 Consumer Device CVM (CDCVM)

• Contactless readers that support VCPS Version 2.1, including all published updates,

must enable support for a Consumer Device CVM. The Consumer Device CVM is a

CVM performed on the consumer's payment device (independent of the reader).

• Reader support for the Consumer Device CVM is mandatory, as is indication of its

support in the Terminal Transaction Qualifiers. In addition to supporting the Consumer

Device CVM, the reader may then support other CVMs such as signature and/or online

PIN.

4.6.2 Support for Pre-Tap

• As part of application processing, if a mobile device with Visa payWave capabilities is

being used, the device may respond to the reader with an error when a CDCVM is

required for the transaction and has not yet been performed. This is referred to as a Pre-

Tap. Once the consumer performs the CDCVM, the mobile device is re-presented to

complete the transaction.

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5 Additional Terminal Considerations

• In addition to the requirements outlined in Section 2, other considerations may apply to

terminals, along with optional features. This Section discusses these additional

considerations.

• The items in this Section are covered in more detail in the Visa Transaction Acceptance

Device Guide. Additionally, acquirers can discuss the requirements with their Visa

representative.

5.1 Magnetic Stripe Transaction Terminal Requirements

• Existing rules governing magnetic stripe transactions continue to govern transactions

performed at magnetic stripe terminals. These rules also apply to magnetic stripe

transactions performed at chip-reading terminals, including EMV-compliant terminals.

Acquirers should implement fallback policies and procedures at the point of transaction,

as well as support for new chip service code values. These policies and procedures are

only applicable to contact-only or dual-interface cards.

5.1.1 Service Codes

• The migration to chip has introduced new service code values. Visa chip cards must

contain a service code beginning with 2, indicating an international chip card, or 6,

indicating a domestic only usage chip card. Current Visa rules require all terminals to

recognize and act on the service code.

• Acquirers must ensure this new service code value will not cause a rejection at magnetic

stripe-only terminals. This is not a new rule, although it may require magnetic stripe

terminal software changes if terminals are not currently meeting this requirement.

• For further details, acquirers should refer to the Visa Operating Regulations.

5.1.2 Fallback

• Fallback transactions are non-chip transactions performed with chip cards at chip

terminals. EMV-compliant terminals must accept both chip and magnetic stripe cards

and have both a chip and magnetic stripe reader. When a chip card is accepted at these

terminals, the card should be read via the chip reader and not the magnetic stripe

reader.

• There are situations when the chip terminal cannot accept a chip card (for example

when the chip on the card is faulty or damaged or the terminal chip reader is

malfunctioning). When a chip card is accepted via its magnetic stripe, the resulting

transaction is referred to as a fallback transaction. These transactions are deemed less

secure because magnetic stripe acceptance circumvents the control and risk

management protection available with chip acceptance.

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• Unattended Cardholder Activated Terminals (UCATs) do not allow fallback beyond

magnetic stripe transactions. In addition, fallback is not permitted for declined

transactions.

• The Visa Operating Regulations state that chip cards must be accepted by the chip

reader unless the chip card or chip-accepting terminal is malfunctioning. In that case, the

transaction can be processed using the magnetic stripe. This rule must be followed for

international transactions and should be followed for domestic transactions.

• The Global Fallback Monitoring Program was introduced to help reduce excessive

international (and domestic) fallback transactions and to establish a global regulatory

framework for these transactions. The intent is to motivate the timely repair or

replacement of faulty equipment, and/or the correction of inaccurately flagged

transactions.

• The program identifies acquirer-country combinations with a ratio of international fallback

to international chip-capable transactions that exceeds the global average international

fallback ratio by one and one half times. Domestic fallback reporting can also use Global

Fallback Monitoring Program thresholds. POS activity is reported separately from ATM

activity. The program also identifies acquirer-country combinations that have fallback

activity nearing program thresholds, which allows acquirers to take proactive measures

to avoid exceeding thresholds.

• Acquirers may incur a fine for each fallback transaction over their allowance. Acquirers

should contact their Visa representative for more information regarding the Global

Fallback Monitoring Program and its application in the U.S. market.

5.1.2.1 Fallback Prevention and Processing

• Acquirers must have software in their terminals to request for the contact chip be used to

prevent fallback transactions. A special chip service code (2xx or 6xx) is encoded on the

magnetic stripe of chip cards. When the magnetic stripe reader reads a chip service

code, the terminal does not process the transaction but displays a message that the card

should be read by the using contact chip. This check helps to ensure that chip cards are

used for chip transactions at chip-reading terminals and minimizes the chance of

inadvertent fallback transactions.

• In a V.I.P. message, Terminal Entry Capability (Field 60.2), Service Code (Field 35 or

45) and POS Entry Mode (Field 22) are used to determine whether it is a fallback

transaction.

• According to the Visa Operating Regulations, after a chip read failure, the terminal must

send the next consecutive magnetic stripe read transaction online to the issuer,

indicating a fallback transaction. The fallback transaction must be identified by

populating the correct authorization message fields. If the transaction is not correctly

identified, the issuer may have recourse via a chargeback. See Section 9.3.1 Host

System Fallback Considerations and Section 11.4.2 Fallback Transactions for more

information about fallback.

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• When online authorization is not available, the merchant may be given the option to

perform voice authorization to complete the transaction. If the magnetic stripe cannot be

read, or if an online authorization is not available, merchants can use existing card

acceptance and transaction processing procedures.

5.1.2.2 Fallback Implementation Activities

• Fallback implementation activities include:

• Follow the Visa Operating Regulations recommendations for fallback transactions.

• The terminal should contain logic between the magnetic stripe reader and chip reader to

invoke fallback if the chip cannot be read.

• Ensure that terminals do not indicate they are chip-capable until the terminal, merchant

and acquirer are fully chip functional and can send all the required chip data. Terminals

that indicate they are chip capable, while continuing to process only magnetic stripe

transactions for chip-capable cards, are a common reason for acquirers to be selected

for fines under the Global Fallback Monitoring Program.

• Monitor transaction activity for fallback. Excessive fallbacks can indicate failure of chip

reading hardware.

• There are also merchant education needs related to fallback. Refer to Section 12.7

Contactless Reader Branding and Placement for further details.

NOTE: A terminal’s capability must take into account both hardware and software, and should

only ever indicate a terminal’s true ability to process a payment transaction. If a terminal

has the hardware to read a chip but not the software to process the payment, it is not

considered chip-enabled because it cannot read and transmit full chip data. Acquirers

that are beginning to deploy hardware for chip terminals should continue to use the TEC

value of “2” until the terminal application is enabled to accept chip technology. Once the

application is enabled, the TEC should be updated to the value of “5.”

5.2 Card Data in Online Messages

5.2.1 Use of Track 2 Equivalent Data

• The terminal must always transmit the full, unmodified contents of the Track 2 Equivalent

Data in the chip to the acquirer including the Issuer Discretionary data. The terminal

should not construct the data in the magnetic stripe field in the online authorization

message based on the individual data elements in the magnetic stripe or chip. The

device should also ensure that if a transaction is processed as magnetic stripe, the track

data used in the transaction is read from the magnetic stripe and correspondingly, if a

transaction is processed as chip, the track data used should be read from the chip.

NOTE: For more information on Track Data, refer to the Visa Contactless Payment

Specification.

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• The Track 2 Equivalent Data in the chip also contains critical information relating to the

card being used, which an issuer may rely upon to authorize a transaction.

• Because the data on the chip may differ from the data on the magnetic stripe, the POS

Entry Mode Code field (V.I.P. Field 22) in the online authorization message that

indicates the source of the track data (magnetic stripe or chip) must be accurate to avoid

unnecessary declines.

NOTE: For either VSDC or qVSDC transactions Track 1 is not supported in the authorization

message.

5.2.2 Form Factor Indicator

• Dual-interface terminals will need to pass the Form Factor Indicator (Tag 9F6E) in V.I.P.

Field 55 for a Visa payWave transaction, if present.

5.2.3 Selected AID

• Terminals that support a merchant controlled option on eligible products will need to

pass information of the selected AID (for instance the AID itself) to the acquirer (or

routing decision maker) in order for the acquirer to determine eligible routing options for

the transaction.

5.3 Support for up to 19 Digit PANs

• Both the Visa Operating Regulations and the EMV Specifications require that all chip

terminals that accept Visa and Visa Electron cards must support variable-length PANs

up to and including 19 digits. The terminal is not required to transmit the 19-digit PAN to

the acquirer and the acquirer is not required to transmit the 19-digit PAN to VisaNet,

unless explicitly mandated, such as for Plus transactions. If the acquirer does not

support 19-digit PANs and a 19-digit PAN is read from the chip, the terminal should

indicate that the card type is not supported and end the transaction.

5.4 Terminal Display Messages

• Terminal messages are displayed to let the merchant or cardholder know the status of a

transaction and what action to take next. To ensure clear and effective transaction

messages, acquirers and terminal vendors should follow a few basic principles,

including:

• The message displayed must clearly instruct the merchant or cardholder on what action

to take.

• Where the message is based on an issuer response, the message should clearly

communicate the meaning of the response.

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• It is recommended that the transaction amount should be displayed to the customer prior

to PIN entry. The cardholder should be prompted to confirm the transaction amount; PIN

entry is an acceptable method of confirmation. If PIN entry is requested before the

transaction amount is known for throughput reasons, an explicit amount confirmation

message should be displayed to the cardholder once the amount is known.

• The message displayed must clearly indicate the status of the transaction. Once the

status of the transaction is determined, the terminal must be able to communicate the

next action. Clear instructions are especially important when an error occurs and the

transaction is terminated. In this case, the transaction message should not indicate a

“decline” but rather that an error has occurred. Error messages for chip transactions

should be closely aligned with messages for magnetic stripe transactions. Messages for

magnetic stripe transactions should be upgraded if they do not already meet these

principles.

• For contactless transactions, the terminal or the reader should have visual and audible

indicators to assist the cardholder. Visual indicators may take the form of LEDs or a

display that allows a graphical representation of indicators.

• For more information and recommendations regarding terminal messages refer to the

Visa Transaction Acceptance Device Guide or alternatively the EMV Contactless

Specifications, Book A, Architecture and General Requirements which is available from

www.emvco.com. This guide includes a list of suggested terminal messages .

5.5 PIN Length and Character Set

• The minimum PIN length is 4 digits. PEDs must be able to accept online PINs of 4, 5,

and 6 digits2,3.

• PEDs may visually indicate that a digit has been entered, such as with an asterisk (*).

This visual indication should occur for each digit entered by the cardholder. For example,

a PED should not display only four asterisks when six digits have been entered.

Similarly, if audible tones are used, the tone should be generated each time that a digit

is entered. The tone must be the same regardless of the digit entered.

• The PIN character set is 0

−

5.6 Cardholder Receipt Requirements

• EMV and Visa require that the terminal should always print the AID and Application

Label (or Application Preferred Name) on the receipt.

• Receipts are optional for transactions up to the VEPS limit. For transactions above this

limit, terminals must generate a receipt.

2 Note that for ATMs, there may be different requirements for PINs.

3 PCI PTS requires support for up to 12-digit PINs.

April 2014 VISA CONFIDENTIAL 53

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• Further information regarding receipts can be found in the Visa Transaction Acceptance

Device Guide. Further information regarding VEPS can be found in the Visa Easy

Payment Service – Acquirer Program Guide.

5.7 Transaction Routing

• Final routing decision of a specific transaction is normally determined in the same

manner as it is for magnetic stripe transactions, which is primarily through the use of BIN

tables. However for chip transactions, the choice of routing possibilities at the acquirer

level may be constrained by the AID used for the transaction as decided during

application selection (see Section 4.4.3 or 4.5.1)4.

• For a chip transaction that has been initiated from a Visa AID that begins with the Visa

ISO RID as defined in Section 4.2.1, the transaction must be routed to a Visa processing

network, but the actual Visa processing network utilized for the transaction will be

defined by the acquirer typically via the use of BIN tables.

• This means that a transaction may be initiated from any Visa AID as defined in Section

4.2.1, but the transaction could be routed to a specific Visa affiliated network. Some

examples of this behavior are:

• A transaction initiated using the Visa AID on a Visa/Interlink card can be routed to either

the Visa network or the Visa Interlink network.

• A transaction initiated using the Visa AID on a Visa card can be routed to either the Visa

network or the Visa Interlink network.

• An transaction initiated using the Visa Interlink AID on a Visa Interlink card will be routed

to the Visa Interlink network.

• These examples assume that all other eligibility criteria for the network in question have

been met, such as the selected CVM and BIN routing table.

• It is very important to ensure routing decisions are not negatively affected by chip

processing. Acquirers and terminal vendors must ensure that Visa, Visa Interlink and

Plus routing function normally for chip-initiated transactions. This includes transactions

initiated for chip cards that contain only the Plus AID, for example, non-Visa proprietary

cards that are enrolled to use Plus or transactions initiated for chip cards that contain

only the Visa Interlink AID, for example, non-Visa branded cards, where Visa Interlink is

used as an alternate network.

4 Thus the acquirer must receive information about the selected AID used for a specific transaction.

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5.8 Acquirer Stand-In

• The rules relating to acquirer stand-in for magnetic stripe continue to be applicable to

chip transactions. Acquirers should refer to the Visa Operating Regulations for further

details or contact a Visa representative.

5.9 Deferred Authorization

• Deferred or delayed authorization occurs when an online authorization is performed after

the card is no longer available. This occurs when the terminal requests an ARQC. The

terminal then informs the card that it cannot go online and requests a TC, obtaining

either a TC or AAC. Later, the terminal uploads a batch of authorization requests that

include the ARQCs for those transactions that received AACs and clearing records for

those transactions that received TCs. The acquirer submits the authorization requests,

some of which are approved online. The acquirer formats and submits a clearing record

for each approved transaction, using the ARQC. A deferred or delayed authorization

may occur when a ferry is out of range of shore, for in-flight sales, or when the device

does not have online capability (for example, unattended kiosks where the transactions

are offloaded nightly to a server and submitted in batches). Merchants performing

deferred or delayed authorizations should complete such authorizations within 24 hours

of the transaction.

5.10 Transaction Type Requirements

• As with magnetic stripe transactions, chip terminals must support a variety of transaction

types. For many of these transactions types, chip transactions should flow similarly to

magnetic stripe transactions. In many cases, the Visa requirements and regulations for

chip transactions are no different from those for magnetic stripe transactions. In some

cases, however, change is unavoidable.

• Transactions where either the card or the terminal has not completed all required

components of EMV processing, including generating an Application Cryptogram, are

not EMV transactions. The same applies for contactless transactions and VCPS

processing. This includes any transaction where data such as a PAN and expiration date

are extracted and used to complete the transaction.

• The following sections highlight some differences in transaction type processing that

acquirers should be aware of and whether there are any differences between contact

and contactless processing.

5.10.1 Pre-Authorizations

• A pre-authorization is when an authorization takes place before the final amount is

determined. It is usually employed for travel and entertainment transactions. Specific

T&E environments have specific Visa rules and best practice regarding how estimated

amounts are determined. Pre-authorizations are subject to Visa rules but normally will be

EMV transactions (for contact chip) or VCPS transactions (for contactless).

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5.10.2 Incremental Authorizations

• Where the final amount will exceed or is likely to exceed the amount of the pre-

authorization, a further incremental authorization may be obtained. The incremental

authorization will be for the difference between the original pre-authorization and the

actual or estimated final amount. A merchant may process as many incremental

authorizations as are necessary to ensure the authorized amount is equal to or greater

than the final transaction amount. Market practice or Visa rules may allow variances

above the pre-authorized amount to be cleared for specific transaction scenarios.

• Incremental authorizations are usually manual or key entered and are not chip

transactions. The original chip data obtained during pre-authorization should not be

resubmitted during incremental authorizations. No chip data (except the PAN and expiry

date) nor the full Track 2 data should be stored or used for this purpose. Merchants can

store the card’s PAN and expiry date in order to perform incremental authorizations, as

allowed by the Payment Card Industry Data Security Standard (PCI DSS) and Visa

rules.

5.10.3 Sale Completion

• A sale completion is the financial settlement of a previously pre-authorized transaction,

often where the cardholder and card are no longer present. The final transaction amount

may differ from the authorized amount, within a range defined by Visa.

NOTE: Typically used for travel and entertainment where the final amount is not known.

• The POS Entry Mode for a sale completion should be set to “chip read” only if the

original online authorization contains a cryptogram and all of the chip data elements

used to generate the cryptogram.

• Transactions should not be identified as “chip read” unless all mandatory chip functions

are performed, including reading all of the required chip data. Transactions identified as

chip read, but with incomplete chip data, may be declined.

5.10.4 Status Check and Account Number Verification

• A Status Check is an online authorization for a single currency unit. Status Checks are

used as authorizations limited to automated fuel dispensing, implicitly allowing up to a

set amount to be used during completion. Status Checks must be sent online because

the chip does not have any mechanism to recognize the implicit value of this special

transaction.

• Account Number Verification is an online message formatted as an authorization for a

zero amount. It can be used to validate that the card used to pay for services in advance

of delivery or to make a reservation is authentic. However, it is not an authorization and

cannot be used to indicate that a clearing transaction was approved.

• Except where specifically allowed, if an online validation is desired, an Account Number

Verification transaction should be used rather than a Status Check.

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5.10.5 Refunds

• A refund occurs when the cardholder is credited with the value of returned goods or mis-

performed services. Both full and partial refunds of the original transaction may be

performed. A refund consists only of a clearing message.

NOTE: In some environments, the refund may be sent online. However, it is sent as an advice

to the acquirer and the acquiring host does not forward the message.

• Visa strongly recommends that refunds for contact chip cards be performed by following

the normal EMV transaction flow to obtain the Track 2 Equivalent Data field from the

chip. If this field is not present on the chip, the terminal should obtain the contents of the

PAN and expiration date fields instead. Performing cardholder verifications, as

performed for purchases, will help protect the merchant and acquirer against fraudulent

refunds.

• Once the required data (either Track 2 Equivalent Data or PAN and expiration date) is

obtained, the terminal should then stop the transaction flow. The terminal must not

request a TC and should request an AAC with the Amount Authorized field set to zero.

The terminal completes refund processing normally using the PAN and expiration date.

• For a contactless refund, a similar approach is taken by following a normal VCPS

transaction flow to obtain the Track 2 Equivalent Data. An ARQC should be requested

with the Cryptogram Amount set to the refund amount for a qVSDC transaction and set

to zero for an MSD transaction and in both cases the transaction type set to “20.”

• Once the terminal has read the Track 2 Equivalent Data information from the contactless

chip, the subsequent decision of the contactless chip to approve or decline the

transaction is not relevant. Therefore, merchant systems should be able to process the

refund irrespective of the cryptogram produced by the card (ARQC or AAC). The

decision to approve or decline the refund should be made by the acquirer or merchant in

the same way as for magnetic stripe.

• If an attempted chip refund fails (for example if the chip cannot be read or chip

technology fails during the transaction), the merchant should re-initiate the refund

transaction either by using the magnetic stripe or by using manual key entry.

• Further information regarding processing of refunds can be found in the Visa

Transaction Acceptance Device Guide.

5.10.6 Reversals

• Reversals are a function of the transaction network or of the device application and do

not require interaction with the card for generation of the reversal message itself.

• A reversal should be generated any time an approval is received for an online

authorization request but where the transaction cannot be completed.

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• In certain circumstances, the issuer may have approved the transactions but the card

may override this and decline the transaction. This is primarily due to an Issuer

Authentication failure where the cryptogram sent by the issuer in the response message

failed verification by the card. In this case, the terminal should initiate a reversal.

5.10.7 Referral

• A referral is intended as a fraud control tool for issuers to use when more information is

needed to verify the identity of the cardholder or the validity of the card prior to approving

a transaction. A referral is not a “transaction”; it is an exception process for a purchase.

Referrals are generally not recommended for Visa payWave transactions as they

impede the convenience of a fast transaction which is associated with Visa payWave.

• When a referral authorization response is received from the card issuer, the terminal

should request an AAC from the card. Generation of an AAC completes the EMV

transaction flow so that the referral procedure can take place. The cryptogram produced

by the card should be disregarded by the terminal as any subsequent approval of the

transaction is dependent on the outcome of the referral process.

• Depending on the implementation, the referral process will most likely result in a

completely new transaction taking place generally when the card issuer has removed the

referral block. Alternatively, the chip data can be used to create a clearing record to

which the authorization code from the voice authorization is added. The clearing record

can contain the ARQC and related data. However, because the chip data was not

presented to the issuer at time of authorization, the POS Entry Mode must indicate

manual entry.

5.10.8 Cancellation

• A cancellation occurs when a purchase or sale completion transaction is aborted either

during or after processing. In a dual-message environment cancellation should only

occur before the transaction is “cleared” to the acquirer.

• There are a number of reasons why cancellation may occur, for example, an error in the

amount entered by the merchant which the merchant may seek to correct by pressing a

cancel button on the terminal. Cancellations also occur when a merchant does not

approve the cardholder’s signature.

• In all cases, initiation of a cancellation should result in the cessation of processing and

clearing of any data elements.

• If the transaction has not reached the point where an ARQC has been requested, the

card can simply be powered off. If an ARQC has been requested and the transaction

has been routed online, then cancellation processing should also generate an

authorization reversal. The transaction should be removed from the clearing batch or

marked ‘void’.

• If the terminal has received a TC or AAC from the card, the transaction is completed and

can be cancelled (removed from the batch or marked as void).

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• It is recommended that the terminal produce a receipt for the cardholder showing that

the original transaction has been cancelled.

5.10.9 Cryptogram Generation in Multi-Currency Scenarios

• Certain terminals have dynamic currency conversion capabilities and are able to handle

multiple currencies. It is critical that the currency code used in the generation of the

cryptogram (ARQC or TC) is the same as is included in the authorization and clearing

messages (V.I.P. Field 55 Tag 5F2A) and is not altered by any intermediary networks. A

change in the currency code could lead to the issuer declining the transaction as the

cryptogram validation will fail.

• In most scenarios, the transaction currency, V.I.P. Field 49, should contain the same

value as the chip data related currency in V.I.P. Field 55 Tag 5F02. There may be

instances where these differ. It is critical that the chip related field is not modified from

the transaction currency that was sent from the terminal to the card and was used by the

card to generate the cryptogram.

5.10.10 Implementation Activities

• Acquirers should review the requirements for supporting transaction types in a chip

environment and work with their terminal vendors to ensure terminals support the chip

requirements. Further details are provided in the Visa Transaction Acceptance Device

Guide.

5.11 EMV Transactions in Specific Industries

• Certain industries have specific payment requirements besides the traditional purchase.

For each scenario, the presence of a chip card may or may not have an impact on

existing processing requirements. The following industries are affected by the

introduction of chip:

• Hotels and car rentals

• Petrol/Fuel dispensing

• In-Flight transactions

• Restaurants

• Visa recommends that acquirers review the Visa and EMVCo guidelines regarding each

industry to ensure any impact is addressed. For more information regarding changes for

specific industries, acquirers should refer to the following documents:

• Visa Transaction Acceptance Device Guide

• Visa Payment Acceptance Best Practices for Retail Petroleum Merchants

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• Recommendations for EMV Processing for Industry-Specific Transaction Types,

available from www.emvco.com

5.12 Purchase with Cash-back

• Visa allows cash-back with a purchase at the point of service for domestic transactions,

under certain conditions. Cash-back is sometimes referred to as cash-back or cash-out.

Current Visa rules do not allow cash-back to be provided on credit cards or when the

cardholder has selected to use a credit facility. Cash-back is also not recommended for

Visa payWave transactions as they diminish the speed and convenience factors that are

key features of Visa payWave. However issuers may elect to support cash-back with

their Visa payWave cards and terminals should process the transactions according to

cash-back rules.

• Where permitted, a terminal must send the cash-back amount to the card when

requested and then send the following cryptogram data to the acquirer for inclusion in

the online message:

• Cryptogram Amount (V.I.P. Field 55 Tag 9F02) – The total of the purchase amount plus

the cash-back amount

• Cryptogram Cash-back Amount (V.I.P. Field 55 Tag 9F03) – The cash-back amount

• If the transaction involves cash-back, the Cryptogram Cash-back Amount must be

present and included in the ARQC algorithm. If the transaction does not involve cash-

back, the ARQC is calculated with a zero cash-back amount and the field is not present

or is zero-filled.

5.13 Terminal PIN Requirements

• Acquirers must ensure that their terminals are capable of supporting PIN as required by

the Visa Operating Regulations and PCI PIN Transaction Security (PTS) requirements.

The terminal must have either a PIN pad or a port capable of supporting a PIN pad.

• If a PIN pad is present and active, it must comply with Visa’s requirements. If the PIN

pad is inactive or not present, the terminal must have the capability to support the

required software to enable a PIN pad to be connected and to comply with Visa’s

requirements.

• Acquirers should refer to the Visa Operating Regulations or contact their Visa

representative for further information regarding PIN pad requirements.

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5.14 Terminal Types and Configurations

• Acquirers should consider all the possible terminal configurations and ensure that each

terminal type is reviewed against the possible impact of migrating to chip acceptance. It

is also important for acquirers to review the Visa Operating Regulations and other Visa

documentation and ensure specific terminal type requirements are incorporated into their

selection criteria and requirements.

5.14.1 Shared Display and Separate Display Terminals

• Attended terminals may have a shared display or separate displays for the customer and

the merchant to carry out the transaction. The terminal type used at a merchant is

dependent on the terminal itself and the merchant environment.

• Terminals may have a single display shared by the merchant and the customer during

the transaction process.

• Terminals with a separate display have a dedicated display for the merchant and one for

the customer. These typically comprise a fixed enclosure for the merchant terminal and

a tethered PIN pad with a dedicated display for the customer.

• In general and unless specifically stated, all requirements and best practices apply to

both types of terminals. Support for application selection by cardholders may require

special considerations where there are separate displays.

5.14.2 Unattended Cardholder Activated Terminals

• An Unattended Cardholder Activated Terminal (UCAT) is an acceptance terminal

managed by a merchant that dispenses goods or services without the assistance of an

attendant to complete the transaction. Cardholder verification and authorization of such

transactions occurs electronically, if required. These terminals include automated

dispensing machines and self-service payment terminals in parking garages.

NOTE: The Visa Operating Regulations prohibit Visa card products from being used for scrip

transactions. (Scrip is a two-part paper receipt redeemable for goods, services or cash.)

• UCATs fall into two categories:

• Unattended Authorized – Transactions are authorized and cardholder verification is not

performed.

• Unattended Authorized with PIN – Transactions are authorized and online PIN entry is

performed.

• A UCAT needs to support “No CVM Required” to ensure CVM processing can be

completed. Otherwise UCATs that support chip need to adhere to the general Visa

requirements for chip terminals.

• The following are not considered UCATs and are not required to meet UCAT

requirements:

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• ATMs, which must meet a different set of requirements.

• Attended cardholder activated terminals, for example, self-checkout terminals in

supermarkets, where an attendant is available to help complete transactions.

5.14.3 Dual-Interface Terminal Configurations

• The physical architecture of a terminal that supports both contact and contactless

transactions can be any of the following:

• Fully integrated terminal: All elements included in a single device.

• Intelligent card reader: The reader handles most of the contactless transaction

processing, passing the results for completion by the terminal.

• Combination of terminal and transparent card reader: The reader provides

communication with the card, while kernels and other processes are in the terminal.

• Acquirers need to determine which architecture best suits their needs and those of the

merchants, including whether some of their existing infrastructure can be reused to

support their migration to VSDC and Visa payWave acceptance.

• Further information regarding contactless terminal configurations and requirements can

be found in the EMV Contactless Specification for Payment Systems, Book A.

5.14.4 Automated Fuel Dispensers

• An Automated Fuel Dispenser (AFD) is a self-service terminal or an automated

dispensing machine that dispenses fuel such as gasoline, diesel fuel or propane. AFDs

have some specific processing requirements, the majority of which are not affected by

the support of chip. The Visa Operating Regulations have specific requirements relating

to the amount that an AFD can authorize before fuel is dispensed. These limits vary

between chip and magnetic stripe and acquirers should review the Visa Operating

Regulations for further information.

• AFDs must do one of the following:

• Obtain an authorization for the exact amount of the transaction

• Use the Status Check Procedure

• Process the transaction using Real Time Clearing

• The above-mentioned processing requirements are not affected by support for chip.

However the terminal needs to adhere to the general Visa requirements for chip

terminals.

• Acquirers should also note that the rules relating to AFDs and the liability shift for chip

transactions are different to other device types. Further details are provided in Section

11.2 EMV Liability Shift.

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5.14.5 Automated Teller Machines

Information regarding ATM requirements is not in scope of this document.

5.15 Terminal Requirements for CVM

• Visa CVM requirements for terminals include:

• An attended POS terminal must support signature (for transactions that require a CVM)

and it may support PIN. A terminal must not prompt international cardholders for PIN

unless required by the chip card.

• A UCAT must support “No CVM Required.”

• VCPS 2.1, including all published updates, readers must enable support for a Consumer

Device CVM. The Consumer Device CVM is a CVM performed on the consumer's

payment device (independent of the reader).

• Requirement:

• If Visa Interlink is supported, online PIN must be supported for both contact chip and

Visa payWave.

• In addition, some cardholders may be unable to enter a PIN at the POS terminal, or

unwilling to do so due to security concerns or certain disabilities. Terminals may need to

support functionality that allow merchants to offer an alternative CVM than PIN for such

cardholders in accordance with merchant protection and state or federal disability

legislation.

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6 Terminal Selection and Approval

• This Section is intended to assist acquirers in creating selection criteria for chip terminals

and provides background information on the terminal approval process before

deployment in the field. It includes the following topics:

• Terminal and Reader Selection Criteria

• Terminal and Reader Approvals

• Considerations for EMV Approval for Contact And Contactless

• Payment Card Industry Requirements

• Acquirer Testing Toolkits and Host Testing

• Implementation Activities

• The information included in Sections 4 and 5 should be considered when creating the

selection criteria and as part of any requirements documentation provided to terminal

vendors.

6.1 Terminal and Reader Selection Criteria

• Prior to meeting with vendors and reviewing their available products, acquirers should

develop their terminal requirements. Acquirers should begin the process by determining

the minimum required, and recommended terminal requirements as outlined by Visa and

the local environment.

• This Section provides an overview of information acquirers could include in their terminal

selection criteria. This is not meant to be an exhaustive list; it is intended to provide

some guidelines to assist acquirers. Acquirers should:

• Ensure any terminals support and are in compliance with:

− EMV requirements as outlined in the EMV Specifications and specification bulletins.

− PCI requirements relating to PIN security (PCI-PTS) and Application Security (PCI

PA-DSS)

− Visa requirements as defined in the Visa Operating Regulations, Visa Transaction

Acceptance Device Requirements and other Visa documentation.

− Ensure contactless readers comply with Visa’s contactless reader requirements

(refer to Section 3.2 U.S. Contactless Acceptance Requirements)

− The reader has been tested and approved by Visa and is on the approved Visa

Approved Product list.

• Ensure that the EMV-compliant chip-reading terminal:

− Reads a magnetic stripe

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− Reads the chip, if an EMV-compliant chip is present, and does not allow for

overriding the chip authorization controls by manually prompting the cardholder to

use the magnetic stripe. The magnetic stripe may be read only if the chip is not

EMV/VSDC-compliant or if the chip or chip reader is inoperable (resulting in a

fallback transaction).

− Supports transaction type requirements; for example, pre-authorizations, reversals,

referrals and refunds.

− Supports magnetic stripe terminal requirements, such as fallback processing and

compliance with requirements for reading service codes.

− Supports Application Selection by the cardholder from a list of both domestic and

non-domestic payment applications as mutually supported by the card and terminal.

− Supports cardholder Account Selection.

• Identify terminal types to be supported; for example, stand-alone point-of-transaction

terminals, integrated POS terminals (“ECR”), mobile POS terminals, or UCATs.

• Identify requirements for a terminal-based exception file if any.

• Identify cardholder verification requirements and how they are used for supported

environments (online PIN and signature), including PIN length requirements.

• Ensure terminals are equipped with ports that support peripherals capable of prompting,

and accepting, a PIN based upon the CVM list on the card.

• Evaluate price versus functionality, hardware, and software peripherals, warranty

conditions, and service and support agreements.

• Ensure that: the terminal is approved to EMV Level 1 and Level 2, EMVCo approval

letters are available, the terminal is listed in the EMVCo website as having current

approval and has an adequate approval period remaining.

• Ensure the terminal complies with Payment Card Industry (PCI) requirements and the

terminal is listed in the PCI published list of approved terminals.

• Confirm with the terminal vendor that the terminal was developed in compliance with the

Visa Operating Regulations, including the Transaction Acceptance Device

Requirements.

• Determine merchant requirements for terminal configuration, for example whether to

require a separate chip acceptance terminal or a peripheral PIN pad unit, and that these

terminals meet Visa’s requirements.

• Verify product availability.

• Determine requirements for transaction speed and estimate the transaction volume to be

supported.

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• Identify which components of the complete merchant configuration are affected by chip,

and identify:

− Components that can be modified by software changes

− Components that require new hardware

− All of the involved vendors

• Conclude whether existing terminals can be upgraded or new terminals are required.

• Identify any additional technological features required, such as cell phone capability, or

Internet connectivity.

• Determine if the terminal can be supported with the acquirer’s existing Terminal

Management System or if there is an impact to an existing one.

• Determine whether it is necessary for the terminal or reader to

− Have incorporated terminal logic to perform special application selection process to

support merchant routing preferences.

− Be able to transfer the result of special application selection process to the acquirer –

in support of merchant routing preferences.

− Support selectable kernels in support of specific CVM conditions (cash-back and

VEPS).

• Complete ADVT, CDET and for stand-alone reader implementations, qVSDC DM

(Device Module) terminal testing prior to deployment.

6.2 VSDC Terminal Approvals

• Acquirers must select a product that meets all the various requirements related to EMV

and VSDC and has been approved accordingly. At a minimum a terminal must meet

EMV Level 1 and EMV Level 2 requirements and be noted as an approved product by

EMVCo and listed in the EMVCo website. Information regarding the EMVCo approval

process can be obtained from the EMVCo website at www.emvco.com.

• All terminals that accept Visa cards must also comply with the Visa Operating

Regulations. Many requirements specific to acceptance terminals, including for contact

chip, are included in the Terminal Acceptance Device Requirements document, a Visa

Operating Regulations extension document. For additional information on the Visa-

specific terminal requirements and best practices, refer to the Visa Transaction

Acceptance Device Guide.

• Terminals must comply with the PCI Data Security Standards (DSS), and often with the

PCI Payment Application Data Security Standards (PA-DSS) relating to application

security. Terminals accepting PINs must comply with the Payment Card Industry (PCI)

PIN Transaction Security (PTS) Pin Security Requirements ,Point of Interaction (POI)

Modular Security Requirements and the Visa PCI PIN Security Requirements.

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• For more information on PCI PIN PTS testing including the Visa PIN Security

requirements, refer to www.visa.com/pinsecurity and

www.pcisecuritystandards.org/security_standards/ped.

• The following sections provide further details on the various approvals required that

acquirers need to consider as part of their VSDC migration project.

6.3 Considerations for EMV Approval

• To accept Visa chip transactions, terminals must comply with the most current version of

the EMV Specifications and be approved for EMV Level 1 and Level 2 by an EMVCo-

accredited laboratory. Compliance to the latest specification will ensure that the terminal

is able to more easily satisfy the testing requirements to gain approval.

6.3.1 EMV Level 1

• EMV Level 1 approval is given for the interface modules (IFMs) – that is, the chip card

reader – rather than for the terminal on which it is tested. An IFM consists of the

hardware and software that powers the chip card and supports communication between

the terminal and the card up to the transport layer. The three main functional

components are the mechanical, electrical and logical chip card interfaces.

• An approved IFM can be used for any terminal, as long as the IFM is not modified and

can be used with any approved EMV application kernel. It is important to identify the IFM

component separately from the terminal, using a unique identifier.

6.3.2 EMV Level 2

• EMV Level 2 Type Approval tests comply with the debit/credit application requirements

defined in the EMV Specifications. EMV Level 2 approval is not tied to a particular model

of a particular type of hardware platform. The approval letter notes the hardware

configuration to be used for testing. The portion of the application that performs EMV

functions and is tested as part of the Level 2 Type Approval is commonly referred to as

the “kernel.”

• An application kernel is approved to run on any terminal that has an approved IFM and

supports the environment used during testing. If the kernel can be used on a terminal

without recompilation, the kernel retains its EMV approval. EMV Level 2 test cases are

performed only against EMV functions. Acquirer, payment scheme and national

specifications are not part of EMV testing.

• An application provider may simulate any non-EMV functions necessary for the

completion of the test cases, for example, message formats, communications protocols,

terminal prompt sequences, or payment scheme settings. These other functionalities,

however, do not necessarily represent the end product because some level of

customization may be required for each acquirer, country or payment scheme.

• Rigorous testing needs to be performed to ensure that customizations and application

changes have no adverse impact on the EMV kernel and functions.

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• A terminal must have an IFM that has been approved for EMV Level 1 before its EMV

application kernel can be tested for Level 2.

6.3.3 EMVCo Approvals and Renewals

• EMVCo has a renewal policy requiring all IFMs and kernels to be re-tested on a regular

basis.

• An IFM approval is valid for 4 years and an application kernel approval is for 3 years.

This validity period applies to static and configurable kernels.

• At expiration of the approval, EMVCo evaluates whether the product, either the IFM or

the kernel, demonstrates sufficient conformance to the current EMV specification and

may grant an extension. IFMs or kernels that do not pass the evaluation will not be

granted an extension and their approval will be considered expired.

• EMVCo may also revoke an approval of an IFM or kernel if a significant interoperability

problem arises in the field.

• Visa policy relating to terminal approvals requires that ADVT be performed only on

terminals that are EMVCo approved. Acquirers should ensure that any new terminal

installations contain IFMs or kernels that have a current EMVCo approval.

• Further information on the EMVCo renewal policy can be found in the EMVCo website at

www.emvco.com.

6.4 Contactless Reader Approvals and Renewals

• Visa oversees testing of card acceptance devices that support Visa contactless

payments. This process allows Visa to ensure that the devices are developed to Visa

specifications and will support Visa applications.

• Additionally, Visa recognizes the contactless Level 1 (analog and digital) testing offered

by EMVCo for devices. Visa recommends that contactless devices have their

contactless Level 1 tested and approved by EMVCo prior to submitting the device to

Visa for application testing. The approval and renewal process for contactless devices is

similar to that for contact chip as outlined in Section 6.3.3 EMVCo Approvals and

Renewals.

• Further information regarding EMVCo contactless approval can be obtained from the

EMVCo website at www.emvco.com.

• To facilitate the testing of devices, Visa has recognized a number of independent

laboratories to functionally test devices containing Visa payment applications on behalf

of Visa.

• If the device is successfully tested, Visa issues a letter of approval to the device vendor

that submitted the device for testing. The approval applies internationally, unless

restrictions are specified in the letter of approval.

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NOTE: Approval is not transferable from one vendor’s product to another.

• Upon successful completion of official testing, the card acceptance device will appear on

one of the Approved Acceptance Device Products Lists located at Visa Technology

Partner site (https://technologypartner.visa.com).

• When a device product is approved by Visa, it is assigned a renewal date which is

communicated to the device vendor in the letter of approval and also appears on the

Visa Approved Products List.

NOTE: The renewal date is typically two years after the date of approval unless otherwise

noted.

• As a device approaches its renewal date, Visa reviews the product details to ensure that

it complies with all current Visa policies and includes a payment application(s) that Visa

continues to support. Further information regarding Visas current renewal policies is

available from Visa Technology Partner site (https://technologypartner.visa.com).

6.5 Payment Card Industry Requirements

• The Payment Card Industry (PCI) Security Standards Council (SSC) is an open global

forum, launched in 2006, that is responsible for the development, management,

education and awareness of the PCI Security Standards, including:

• Data Security Standards (PCI DSS)

• Payment Application Data Security Standards (PA-DSS)

• PIN Transaction Security (PTS) requirements

• The Council's five founding global payment brands, (American Express, Discover

Financial Services, JCB International, MasterCard Worldwide, and Visa Inc.), have

agreed to incorporate the PCI DSS technical requirements into their data security

compliance programs.

6.5.1 PIN Entry Devices

• A PIN Entry Device (PED) is any device used by a cardholder to enter a PIN. (It may

also have other functions.) A PED that supports online PIN where the PED and chip

reader are not integrated must contain an Encrypting PIN pad (EPP) used for entering

a cardholder PIN.

• The PED and EPP may be integrated, as in some standalone POS terminals, or the EPP

may be just one component of a PED, as in a UCAT. Further information regarding

requirements for PEDs can be found in the Visa Transaction Acceptance Device Guide.

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6.5.2 PED Testing Requirements

• Visa requires testing of PEDs against the PCI PIN Transaction Security (PTS)

requirements if they are used in the acceptance of Visa card products with offline PIN or

online PIN verification. PEDs and EPPs must undergo a physical and logical security

evaluation performed at a PCI recognized test laboratory.

• For information on PCI PIN entry device security requirements, see www.visa.com/PIN

and www.pcisecuritystandards.org/security_standards/.

6.5.3 Payment Application Data Security

• Visa has introduced compliance mandates requiring all new merchants to be PCI-DSS

compliant, including using payment application software that uses Payment Application

Data Security Standard (PA-DSS) compliant applications.

• Acquirers must ensure that their merchants and agents use PA-DSS compliant payment

applications. For purposes of the mandates, payment applications apply only to third-

party payment application software that stores, processes or transmits cardholder data

as part of an authorization or settlement of a payment card transaction. POS terminals

are an example of this.

• PA-DSS does not apply to merchant or agent in-house developed applications, stand-

alone hardware terminals or PEDs. Payment application vendors must validate the

conformance of their products to the PA-DSS. Acquirers should insist that their

merchants and agents use compliant applications and upgrade or patch applications to

ensure the storage of sensitive cardholder data meets the Visa mandates.

• More information can be found at www.visa.com and

https://www.pcisecuritystandards.org/security_standards/.

6.6 Acquirer Device Validation Toolkit

• Visa recognizes that acquirers and terminal vendors need a clear and easy way to

validate that their contact chip terminals are configured to meet their domestic and

regional market needs and that international chip cards entering their countries

experience the same level of acceptance.

• To help ensure that terminals acquirers deploy do not contribute to interoperability

problems, Visa has developed the Acquirer Device Validation Toolkit (ADVT), which is a

set of test cards and test scripts that acquirers or vendors can use on terminals that

have already received EMV Level 1 and Level 2 approval and are configured for

deployment (that is, after the country code, floor limits, and other processing parameters

are set up in the terminal).

• Chip acquirers must use the ADVT on each type of contact chip terminal if:

• A new hardware, payment application software or payment-related configuration is

introduced, or

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• Significant hardware or software modifications are made to existing terminals, or

• Changes have been made that impact EMV transaction processing.

• The ADVT User Guide provides guidelines with details of the specific conditions that

determine the use of ADVT and is part of the ADVT package.

• As described in the Visa Operating Regulations, an acquirer that fails to utilize the ADVT

on a terminal that causes a chip interoperability issue may be subject to penalties as

defined in the Visa Chip Interoperability Compliance Program. Refer to Section 7.3 Chip

Interoperability Compliance Program, for more information.

• Acquirers shall also use a subset of the test cards in the toolkit or an ADVT simulator to

conduct online transactions with VCMS.

6.6.1 ADVT and EMVCo Approval

• Use of the ADVT does not preclude the requirement that contact chip terminal

components be approved by an EMVCo-accredited laboratory. EMVCo approval is a

prerequisite for a terminal to be validated by acquirers using the ADVT. Use of the ADVT

is intended to ensure basic chip functionality is not compromised during application

integration and that basic Visa requirements are met, as well as to uncover exposures to

some common interoperability issues. Use of the ADVT does not imply or guarantee that

a terminal is fully compliant with EMV specifications or Visa requirements.

6.6.2 Chip Compliance Reporting Tool and ADVT Submission Requirements

• Visa developed the Chip Compliance Reporting Tool (CCRT) as a centralized, server-

based solution for the systematic reporting of ADVT, CDET, and qVSDC DM test results.

The CCRT facilitates a more efficient submission and management process of ADVT

compliance reporting by chip acquirers.

• CCRT provides Visa acquiring clients with an appropriate level of security and

confidentiality in managing their ADVT results, and enable the CCRT service to be

consolidated with other services currently provided. CCRT is available on Visa Online

(Visa’s online solution for providing secure access to Visa content and services for

clients globally).

• It reduces potential errors in manual entry by guiding users to choose from applicable

options and providing mandatory information. A user can re-use existing reports as a

starting point for new reporting, reducing time spent completing the reports.

• Acquirers or their processors are required to use the CCRT to submit their ADVT test

results; it is the only method under which Visa will accept ADVT test results.

• Further information regarding the use of CCRT can be found in the Chip Compliance

Reporting Tool User Guide for Chip Acquirers.

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6.6.3 ADVT and Expired EMV Approvals

• To encourage the deployment of modern kernels and interface modules (IFMs) that are

less susceptible to interoperability issues, Visa requires that an acquirer must not submit

ADVT testing results to Visa for terminals containing kernels and IFMs that have expired.

• This rule only applies where the results of ADVT testing are to be made available to

Visa. Other uses of ADVT, such as for internal regression testing, are not affected.

• This will not affect deployed terminals or the deployment of terminals already approved

against ADVT. However, it will prevent the deployment of new and updated terminal

configurations that use expired hardware or software.

• More information on the requirements and rules can be found in the ADVT User Guide.

6.6.4 ADVT Ordering Process

• The ADVT test card packs can be obtained from Visa’s third party fulfillment service

(Merrill Corporation). If you prefer to use a test tool, ADVT card profiles are available

from confirmed third-party test tool vendors. For a list of confirmed tool vendors, see

Product Toolkits at https://technologypartner.visa.com.

• Visa may continue to enhance tools and procedures associated with ADVT and will

notify acquirers in advance of such changes. The goal of this strategy is to provide a

more comprehensive end-to-end testing environment and process that enables

acquirers to validate terminal configurations with the ADVT. For example, the use of host

or network simulators for online transaction validation is key to more efficiently and

effectively validating the acquiring process.

6.7 Contactless Device Evaluation Toolkit

• In addition to the use of ADVT, terminals that support Visa payWave must comply with

Visa’s Contactless Device Evaluation Toolkit (CDET). Similar to ADVT, CDET is a set of

test cards and an accompanying user guide that allows acquirers to validate the correct

configuration of their contactless readers. The toolkit is also a self-administered solution.

• Further information can be found in the Visa Contactless Device Evaluation Toolkit User

Guide.

• The CDET test card packs are available from Visa. If you prefer to use a test tool, CDET

card profiles are available from confirmed third-party test tool vendors. For a list of

confirmed tool vendors, see the Visa-Confirmed Third-party Chip Tool Suppliers list

located on Visa’s Chip and Contactless Implementation page at VOL Visa Online (list

can also be found at Visa Technology Partner website

https://technologypartner.visa.com/ under Product Toolkits).

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6.8 qVSDC Device Module

• Visa has introduced a contactless component to the ADVT, the qVSDC Device Module

(DM). It was developed to address specific product approval self-testing requirements for

Visa payWave acquirers, deploying contactless readers compliant to the Visa

Contactless Payment Specification (VCPS) and supporting quick Visa Smart Debit and

Credit (qVSDC). Prior to activation and deployment of these readers, Visa payWave

acquirers are required to use the qVSDC DM and validate successful results as part of

the overall contactless reader approval process.

• Use of the qVSDC DM is governed by the same rules and policies that exist for the

standard ADVT, i.e. use of this toolkit is mandatory for stand-alone readers prior to

deployment in situations where an acquirer has either modified software on an existing

device or is in the process of installing a new device to support Visa payWave

acceptance. In the specific case of a Visa payWave acquirer deploying a new qVSDC-

supporting stand-alone reader into their existing acceptance environment, use of the

qVSDC DM is required in order to complete the self-testing component of the device

approval process, and is a Visa requirement prior to deployment of such readers.

• For further information regarding the use of ADVT-qVSDC DM acquirers should refer to

the qVSDC Device Module Test Cases document.

• Use of ADVT-qVSDC DM is confined to contactless readers supporting qVSDC. It does

not apply to readers supporting MSD Legacy such as those currently deployed in the

U.S.

6.9 Additional Toolkit Requirements

• Acquirers are required to use the ADVT, CDET and qVSDC DM (conditional) toolkits

prior to initial terminal deployment (including all variations of hardware, software, and

parameter settings) to ensure that the terminal has been set up and configured correctly.

It is expected that acquirers will run every applicable test to gain the full benefit of the

toolkit. When the acquirer’s test results do not match the expected outcome of the test,

the acquirer should work with its terminal vendor (and Visa, if necessary) to correct the

problem. The acquirer will continue to perform the test until the problem is resolved and

the acquirer’s test result matches the expected outcome. An acquirer that fails to use the

ADVT, CDET and qVSDC DM (conditional) toolkits on a device that causes

interoperability issues may be subject to fines as defined in the Visa Chip Interoperability

Compliance Program.

• In addition, it is strongly recommended that acquirers use the toolkits on previously

deployed terminals in order to ascertain if there are potential acceptance problems.

• Use of the ADVT and CDET toolkits is intended to ensure basic EMV contact chip and

contactless functionality is not compromised during application integration and Visa

requirements are met, as well as to uncover exposure to some common interoperability

issues. Use of the toolkits does not imply or guarantee that a terminal is fully compliant

with EMV specifications or Visa requirements.

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• The ADVT and CDET toolkits can be obtained through Visa’s third party fulfillment

service (Merrill Corporation). Substantially similar tools are also available from Visa-

confirmed third party vendors. For a list of Visa-confirmed tool vendors, see Product

Toolkits at https://technologypartner.visa.com/.

• After an acquirer successfully completes the ADVT and CDET Toolkits testing as well as

qVSDC DM testing (if applicable), the test results are provided to Visa by submitting the

results into the Chip Compliance Reporting Tool (CCRT). The submission of the

applicable test results for compliance reporting needs to be completed to ensure chip

and contactless acquirers minimize the risk of interoperability problems.

6.10 Visa Chip Vendor Enabled Service (CVES)

• This service, launched in October 2013, will help streamline the testing and reporting

requirements for the deployment of ATM and point-of-sale chip-acceptance devices in

the U.S. CVES engages third-party chip tool vendors to execute mandatory Acquirer

Device Validation Toolkit and Contactless Device Evaluation Toolkit testing on behalf of

acquirers and processors, analyze the results and submit reports to Visa using the Chip

Compliance Reporting Tool.

• Vendors choosing to participate in CVES must complete a confirmation process by

which the vendors’ eligibility is verified and the ability to effectively deliver the required

services is demonstrated. Approved vendors are included on the Visa-Confirmed Third-

party Chip Tool Suppliers list which can be found on Visa Online and the Visa

Technology Partner website.

6.11 Acquirer Host Testing

• CDET, ADVT, qVSDC DM (if applicable) terminal testing needs to be completed prior to

host testing. An acquirer will use a production ready terminal (EMVCo and Visa

approved) which has completed terminal testing for host testing. An acquirer can also

run the host test cards through a terminal prior to host testing. Further information

regarding host testing can found in Section 10, Acquirer Host Testing.

6.12 Implementation Activities

• Development of an EMV/VSDC-compliant terminal is a lengthy process and must be

considered in the project timelines. To launch a program in the shortest timeframe, Visa

recommends selecting a vendor that is already approved. A list of EMVCo-approved

products and vendors may be found at www.emvco.com.

• Develop terminal requirements using the information in this Section as a guideline as

well as the requirements and considerations outlined in Section 3 and Section 4.

• Review vendor products to determine which vendors meet the requirements. This may

be accomplished through a Request For Proposal (RFP) process.

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• Ensure that the vendor selected has obtained approval for EMV Level 1 and Level 2 or is

in the approval process and EMV Level 1 contactless approval.

• Ensure that the contactless reader selected has obtained Visa approval and is listed on

the Visa Approved Vendor List.

• Ensure that if PIN is a requirement in the selection criteria that terminal vendors have

received PCI approval and the terminal is listed in the PCI website.

• Once terminals and reader have been selected, it is important to work with any preferred

vendor to ensure they comply with Visa’s requirements as well as any U.S. market

requirements.

• The vendor should also integrate ADVT and CDET testing as part of their delivery

schedule and ensure enough time is allowed to ensure adequate testing.

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7 Terminal Testing and Maintenance

• This Section outlines Visa’s recommendations for acquirers to undertake post

deployment testing to address and resolve acceptance and interoperability problems that

may be inadvertently introduced during rollout. Visa has developed a number of toolkits

that can assist acquirers.

• The Section includes an approach and guidelines acquirers can follow to minimize the

chance of terminals or contactless readers creating interoperability problems and the

potential impacts, including Visa penalties, if interoperability issues are not addressed as

defined in the Visa Chip Compliance Program.

7.1 Terminal Testing Process

• Maintaining the reliable and efficient operation of acceptance terminals is critical to

ensuring Visa cardholders continue to trust the payment system. The introduction of chip

terminals may lead to unforeseen issues being introduced due to the complexity and

possible lack of experience by acquirers or merchants. Problems could be created due

to a lack of controls and processes around the deployment of production terminals in the

field which could lead to:

• Incorrectly configured terminals or readers

• Deployment of untested or unapproved terminals or readers

• Deployment of outdated terminal