EMV chip cards and operational response to payment card fraud by commercial banks in Kenya

Abstract

The purpose of this study was to look at EMV technology adoption as an operational response strategy to payment card fraud by commercial banks in Kenya. The objectives were three fold, namely: to determine the extent of adoption EMV technology by Kenyan banks; to determine the challenges of using EMV cards in Kenya; and to establish the relationship between EMV card adoption and payment card fraud. The study identifies the various types of payment card fraud and the impact payment card fraud has on financial institutions and their customers. The literature review identifies the operational response strategies to payment card fraud by commercial banks and the challenges experienced in adoption of EMV chip cards in Kenya. The study employed a census study of all the commercial banks in Kenya. Data analysis was conducted using descriptive statistics and correlation analysis The study establishes that commercial banks are aware of the challenges payment fraud caused and requirements necessary to minimize payment card fraud. Adoption of EMV is one of the methods fronted to reduce fraud; however this too has its challenges.