Who’s Lagging behind in the EMV Liability Shift?
While most small- and large-sized merchants have upgraded to EMV-capable equipment, it’s the mid-sized companies that are struggling, reports Transaction Trends.
Why? It’s not a cut-and-dry answer. Rob Kroeger, i3 Merchant Solutions’ director of integration, explains what some of these merchants have working for and against them.
“Large retailers have resources to work directly with manufacturers to develop custom solutions,” Rob explains. Some companies even have their own IT departments who can facilitate the shift, versus going to an outside vendor. Plus, if they do have to seek outside help, they have more pull to jump ahead in line.
Small companies handle the shift well because they can take advantage of readily available terminal solutions. They either don’t have sophisticated POS systems and only need to upgrade current equipment or simply purchase an EMV terminal. While some can persuade their parent companies to provide the new equipment.
Mid-Sized Merchants Are Struggling
Mid-sized companies don’t have the tools of the big companies or the simplicity of the small companies, leading to lag times in becoming compliant.
“We’ve seen this trend within our own portfolio,” Rob says. “It’s often the mid-sized companies that don’t quite fit the off-the-shelf solutions, and don’t have the same resources available to the largest retailers. They’re stuck waiting for the evolution of new, innovative EMV solutions to catch up to the marketplace.”
Plus, with chargebacks on the rise, merchants are feeling more pressure than ever to become compliant, so demand is starting to outweigh supply. Chargebacks have doubled since the EMV liability shift took place.
The Bottom Line: EMV-Compliance Is Worth It
Some merchants, especially those that sell small-ticket items, feel like they’re less exposed to fraud. They also feel like the chargeback losses – something as nominal as a $5 transaction, for example – don’t outweigh the cost of upgrading their equipment.
“EMV is simply a liability shift. It’s most certainly not a mandate,” Rob explains. “However, over time, it may become a perception issue within their own customer base, and the need for an EMV solution may be driven by the customer’s desire to protect their card data over the risk of losing a chargeback.”
Additionally, unnecessary chargeback fees that seem trivial now may accumulate over time and have a larger impact down the road.
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