Credit Card Processors Aren’t Buying Netflix’s EMV Shift Excuse

http://ift.tt/1HtNTgL

When Netflix announced its quarterly results this week, they had an explanation for why their new subscriber number fell short of their projections. The shift to smart-chip (or EMV) payment cards means that the service lost some subscribers while customers received new card numbers and forgot to change them over. That’s a good story, but people in the banking business have some issues with it.

“I would be surprised if this was an issue in the industry right now and we’re only hearing about it from Netflix,” the chief executive of credit card processing company Cayan told the Wall Street Journal. Yet they aren’t. Netflix appears to be the only business so far that has complained about it.

Subscription services that bill cards from MasterCard or Visa every month are able to obtain their customers’ new card numbers and expiration dates when new cards are issued. Mysterious “people familiar with the matter” told the WSJ that Netflix has used this tool in the past to keep accounts current, but couldn’t say whether the company participates now.

However, Netflix counters that not all issuing banks are part of this program. Also, switching to EMV is supposed to mean that customers receive new cards with the same number and a chip for added security.

Card Firms Push Back Against Netflix Claims [Wall Street Journal] (via MarketWatch)

by Laura Northrup via Consumerist