1. Why do EMV transactions take so much longer?
EMV adds an additional layer of security to payment card transactions that use chip enabled cards. When a consumer uses an EMV card, and the merchant is properly set up to accept EMV cards, the inserted card is doing a variety of things. The chip authenticates, validates and ultimately processes the transaction. During this two-way communication between the chip on the card and the terminal, additional time (milliseconds) is required.
It’s been almost seven months since the U.S. EMV liability shift occurred. Even though the EMV migration has been slow in the U.S., many big box retailers, such as Best Buy, Home Depot, Walmart etc. have upgraded their payment technology to accept EMV chip cards – a new credit card security standard in the U.S. But many small businesses have not yet migrated.
The United States experiences 47 percent of global credit card fraud, according to Security Magazine, primarily due to the volume of magnetic strip cards still in use. Earlier this year, The Strawhecker Group found that only 37 percent of companies put measures in place to meet EMVCo’s requirements whereby merchants would be able to accept Chip and PIN cards, although 72 percent are expected to be ready to process chip cards by the end of 2016. The group originally estimated that, as of the survey date, 44 percent of businesses would be capable of processing chip-enabled credit cards, but merchants are behind schedule for the following reasons.
EMV adoption in the United States continues to grow, with Aite Group reporting that 70 percent of credit cards were EMV-enabled at the end of 2015. Although fast-casual restaurant owners face a fraud liability shift if they aren't equipped for EMV cards, some are delaying adoption due to concerns about upgrading their POS systems and longer transaction times. As a value added reseller (VAR), you can reassure your clients by conveying these key consumer benefits for EMV adoption.