EMV: A six-second investment in security

Maria Schuld
Group Executive – Financial Services Group
Posted on August 30, 2016

EMV in Retail

EMV transactions are estimated to take six to 15 seconds longer than magnetic stripe transactions. While the latter number comes from the earliest days of EMV, when the first consumers were learning to dip their cards, it’s clear that EMV transactions are less convenient at the moment of payment. In the never-ending fight against fraud, however, that six seconds is an invaluable investment in security – for you and your customers.

Evidence directly following the Oct. 2015 liability shift suggested that pushback from consumers was less than anticipated, although some consumer segments – those on a time clock, millennials and consumers shopping at peak times – were more negatively affected. In total, however, fewer than one in five consumers complained about the longer transaction times, according to a study by Boston Retail Partners. Still, many in the industry felt, with the holidays arriving and longer checkout lines forming, consumers would quickly tire of waiting and merchants would push for solutions such as contactless EMV to speed things up.

It seems those fears were unfounded as a study by CreditCards.com in March 2016 found only 16 percent voiced complaints about the longer transaction time, while 59 percent had no complaints at all.

Perhaps most importantly, 12 percent complained that not enough stores accepted their cards yet. In my opinion, that’s an indication of demand for greater security. It also means adoption is going better than predicted, and issuers are doing their part by getting EMV cards into the hands of consumers.

So why is EMV is still on the back burner for some big merchants? I’m sure you’ve seen papers taped to readers telling consumers to swipe instead of insert. Why would merchants take that risk?

It seems to me that some big retailers are making a conscious decision to accept the liability risk to keep the line moving. One large retailer estimates extra costs of $600,000 per year for every second added in transaction time. Meanwhile, they don’t want the burden of increased labor costs associated with adding extra lines. The problem with this line of thinking, of course, is that costs of not implementing EMV are substantial. According to Boston Retail Partners, some retailers are now receiving chargebacks exceeding $100,000 per month – a figure sure to grow among remaining non-compliant retailers.

Non-compliant merchants need to know:

  • Every time they use a magnetic stripe reader, they invite potential fraudulent transactions.
  • Every time they accept a magnetic stripe transaction for a chip card that’s presented at point of sale (POS), they are opening the door to liability losses.
  • If they are targeted by fraudsters, the losses can be huge because fraudsters can steal information more quickly than the time it takes to identify them.
  • If fraud hasn’t happened already, it will. Fraudsters exploit the weakest link – those not equipped to accept EMV and those not requiring their customers to dip instead of swipe their EMV cards.

We’ve all witnessed occasional grousing at checkout about EMV cards from retail employees, usually in response to frustration voiced by customers. I questioned an employee casually the other day when she made a negative comment about EMV and it was clear that no one had explained the benefits to her. Issuers and merchants need to work together now to educate retail employees to make them EMV advocates, particularly as the big shopping holidays approach.

Benefits of success are obvious. Prior to EMV implementation, the United States accounted for nearly half of credit and debit card losses worldwide, according to Nilson. EMV makes consumers a part of the fight against fraud, and anything that eliminates fraud saves money – the direct costs of theft as well as the indirect costs of resolution. Further, a more secure card is also more likely to be top-of-wallet.

So how do we make everyone work together? The message to retailers is that you must protect your company from liability and your customers from data breaches; The message to consumers is that properly using your chip card better protects you from fraud. From there, we must repeat the messages till the new behavior is a habit.

Fortunately, there are multiple channels to deliver our message.

Financial Institutions: Retailers:
·         Use branch and call center employees and branch and ATM signage/electronic messages to push EMV importance. ·         Encourage employees to become EMV advocates.


·         Online and mobile contact points will touch the majority of customers, including millennials, who are most demanding of speed. ·         Convey EMV value to consumers at POS and help them understand how the technology protects them against fraud.


How big a problem is card fraud for your institution and what measures are you taking or considering to reduce it?


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Maria Schuld
Group Executive – Financial Services Group

With over 20 years of experience in the financial and payments industry, Maria is the Group Executive for debit, credit, fraud operations and business management. Previously, she was a senior management team member for Metavante before its 2009 acquisition by FIS. Other areas of expertise include implementation management, account management, and professional services management.