For retailers, confusion reigns after EMV rollout

Sharon Goldman

PIN likely to remain a niche 

Big Box retailers are advocating for the use of PIN-based cardholder verification because it affords an added and critical layer of protection, particularly against lost and stolen card fraud, says Townsend:  “We believe that PIN is the next logical step that retailers and card issuers will adopt to provide an additional layer of protection for consumers and point of sale environments.” 

But, while it would further increase security, requiring PIN is likely to remain a niche, Staub maintains. “There seems to be a strong feeling among card issuers and brands that American consumers aren’t ready for another substantial change to how payments are processed,” he says. 

In addition, some experts maintain there are pros and cons with both chip and PIN and chip and signature measures. “Although several entities are pushing for chip and PIN and have called chip and SIG a half measure, chip and SIG is likely the best immediate solution as not all retailers support PIN purchases,” says Drieling. “Also, note that issuers see more revenue from SIG based purchases – I would argue that chip and SIG offers the most cost-effective and immediate solution in counterfeit fraud.” 

What small retailers need to keep in mind about EMV migration 

The EMV transition has been a challenge for many businesses, but smaller businesses that without much in-house technology expertise are at a particular disadvantage. Here are three things retailers need to keep in mind about migrating to EMV: 

  1. Deploy an EMV solution that meets your business needs. Small business owners should be looking at EMV now, but they also need to take the time to make sure that they’re deploying a solution that meets the needs of their business. “It doesn’t mean that merchants should attempt to quickly cobble together a compliant solution,” Staub says. “They need to identify an upgrade path that enables EMV payments while also maintaining and building on the broader value to their operations.” 
  2. Take precautions to help minimize the risk of fraud. Retailers that have yet to implement EMV technology can still take appropriate precautions to minimize risk. “Check the signature on a receipt to make sure they match those on the card,” says Staub. “And, ask customers for identification for unusually large transactions.” 
  3. Remember that EMV compliance takes time. It’s not the end of the world if you’re a merchant and you didn’t upgrade by October 1, says Drieling. “It’s going to take years for total EMV migration to take place,” he explains. “Small businesses that don’t see much fraudulent transactions may take a wait and see approach or simply conclude that the investment doesn’t make economic sense. In other cases, if you’re a merchant who may potentially see higher fraudulent transactions and have not migrated to EMV, you may be in for a rude awakening.”

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