Tuesday , March 28, 2023

EMV at Two: Consumers Still Think Purchases Are Too Slow; Many Merchants Indifferent

EMV chip card payments at the U.S. point of sale have been around, officially at least, for two years now, but consumers still perceive them as slow, and many merchants still don’t accept chip cards, according to a poll of consumers and retailers by merchant processor Cayan.

The time to complete chip card transactions remains a big issue. Last year, Boston-based Cayan estimated consumers spent 116 million hours at checkout counters waiting for chip card purchase approvals. In response to consumer and merchant complaints, all of the major payment card networks have instituted programs to speed up the process.

Still, it appears more work needs to be done, at least on improving the perception of increased speed, according to results of recent online surveys of 1,000 consumers and 500 retailers by a third-party research firm commissioned by Cayan. “Despite the fact that chip card transaction speeds have generally improved (the average transaction takes around 11 seconds), our study found shoppers feel like it just still takes too long,” Cayan said in a blog post. “Twenty-six percent of consumers estimate they wait half a minute or more for a transaction to complete, while another 22% report wait times up to 20 seconds long.”

What’s more, many merchants appear to be indifferent to this consumer frustration. “Seventy-six percent of [merchants] claim to be ‘mildly to not at all frustrated’ by the fact that their chip card transactions are taking so long,” the post says. “Clearly, there’s a disconnect between what retailers think is acceptable and what consumers want, but there’s still an opportunity for merchants to accelerate their EMV systems. With the holidays fast approaching, making speedier EMV processing a high priority could make the difference between a positive and a frustrating customer experience.”

Cayan also found that only two-thirds of the surveyed merchants accept chip cards despite the fact that the networks’ October 2015 liability shifts transferred to them financial responsibility for fraudulent card transactions if their POS terminals cannot read EMV cards. None of the surveyed retailers were Cayan merchants.

“What’s more surprising is that, despite the mandate, 38% of those retailers who don’t accept EMV think it’s not necessary,” Cayan said. “Whether the barrier is a matter of cost or the perceived complexity of implementation, the reality is that every merchant should now be EMV compliant—not only to avoid fraudulent chargebacks but also to deliver on the payment options customers expect.”

In addition to merchants who don’t feel a need for EMV, 28% of the non-accepting retailers surveyed think EMV is too expensive, 9% can’t find the right vendor, and 24% cited other reasons for not taking chip cards, Dominic Lachowicz, senior vice president of engineering at Cayan, tells Digital Transactions News by email.

Lachowicz adds that a review of millions of Cayan transactions over a two-week period found that 80% were EMV transactions versus 20% on magnetic-stripe cards. There isn’t “much difference in the authorization time between [magnetic-stripe] and EMV transactions for Cayan’s merchants,” he says, noting that merchants using Cayan’s Genus ChipIQ technology are getting a 4-second average response time from inserting, or dipping, an EMV card into the POS terminal to customers writing their signature.

Cayan is working with Visa, Mastercard, American Express, Discover, and other networks “to make the cardholder’s checkout experience as quick and seamless as possible,” Lachowicz says.

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