EMV Becomes All-Consuming Topic at a Trade Show for the Broader POS Industry

The broader business of point-of-sale technology has many concerns that include payments but aren’t limited to that function. These days, though, it may seem that payments—and especially EMV—is all this business talks about. This was certainly the case this week at RetailNOW, a four-day conference in Orlando, Fla., produced by the Retail Solutions Providers Association, a trade group for value-added resellers and independent software vendors.

“There will never be a bigger opportunity [than EMV],” said Henry Helgeson, chief executive of Cayan LLC, a Boston-based processor that works with VARs and ISVs. “ISVs that don’t [sell EMV] will regret it at next year’s [RetailNOW].” Helgeson was part of a six-person panel Wednesday that was formed to discuss major themes in the POS industry but wound up spending most of its time on EMV.

Jeff Yelton, a vice president at Ingram Micro Inc., Santa Ana, Calif.-based technology vendor, and another member of the panel, underscored Helgeson’s point by comparing EMV to the opportunity presented 15 years ago by the advent of a new century. “EMV is a Y2K event for the industry,” he noted.

Much of the talk about EMV is driven by the Oct. 1 deadline by which merchants must be equipped to accept EMV chip cards or take responsibility for counterfeit and lost-and-stolen card fraud.

Yet, for all the focus on EMV, many merchants remain without the necessary POS devices. Some are even buying new mag-stripe terminals that don’t have chip-reading capability. “We’re still selling mag-stripe readers today. I don’t know where that is going,” said panelist Greg Dixon, chief technology officer at reseller ScanSource Inc., Atlanta. “I see a lot of mistakes being made.”

That point made an impression on Helgeson. “I’m flabbergasted that mag-stripe-only readers are still going out there,” he said.

Another “mistake” noted by Dixon is a lack of urgency among many merchants despite the impending liability shift. “There’s a whole lot of wait-and-see attitude. That’s going to hurt us,” he said.

Some panelists looked forward to the security enhancements EMV will usher in. Chip cards help combat card counterfeiting but do little to stop online fraud using stolen card credentials. “If we don’t maintain at least a baseline of security, we risk moving back to cash or to a blockchain currency like Bitcoin,” said panelist Oliver Manahan, vice president for emerging payments at MasterCard Inc.

But others cautioned against over-optimism regarding security. “EMV is not going to be the silver bullet to stop data breaches by any means,” said Joe Majka, another panelist and chief security officer at San Jose, Calif.-based terminal vendor VeriFone Systems Inc. “Breaches aren’t going to stop. If merchants think they’re going to keep a hacker out of their systems, they’re totally wrong.”

Majka added that merchants and processors must supplement EMV by encrypting and tokenizing card data to make the information “useless” to thieves even if they do break in.

The panel also looked briefly at what will come after EMV, including mobile payments using near-field communication, a short-range transmission technology that allows cards and mobile devices to link to terminals. “I hope people aren’t making the mistake of putting in EMV without NFC,” Helgeson noted.

But even these are relatively short-term concerns, Helgeson observed. Longer term, what the technology vendors will have to reckon with is predictive-analytics software that tracks customer shopping to determine rewards and drive loyalty programs.