I have been reading GS for some 20 years and have been pleased with your coverage of the entire EMV and PCI DSS compliance. Especially since the whole thing was damn near ignored till the last minute by the general media, including financial news networks.
What coverage there has been is spotty at best and shoddy at worst. I heard one respected reporter refer to the liability shift as a new law, and the reporters I have seen cover the story have largely relied on merchants as a source of information. The fact that I have yet to see a single industry professional interviewed about this story is a bit crazy. God knows there are enough of us around. So thank you for your coverage.
My question is, have you yet heard about the terrible dysfunction in the EMV tip program? I suppose this has to do with the fact that Europeans do not tip as much as we do, but it appears that the current EMV platform will not support tipping as we know it. No more getting a receipt brought to your table that allows you to sit back and contemplate your tip.
The new system requires the cardholder to walk up to the POS terminal and use a PIN pad to enter a tip while the server stands by. Tip adjusting is no longer available. I have been told by two ISOs that the system was designed that way and no other options are available. One ISO tells me it is "being worked on," but they have no specifics or timeline.
Is this impacting the entire industry? Is there a hardware platform that was prepared for this and still allows the earlier form of accepting tips once the EMV is activated?
Fortunately, my new portfolio is small and the automatic updates for EMV after Oct. 1 only marginally impacted me, but I can only imagine the nightmare that this caused at some high-volume restaurants that suddenly had to find a new process on the fly to process credit cards with tips. The few clients I had were caught off guard when the tip line disappeared overnight.
I hope to read a lot about this in the next issue of The Green Sheet. I am holding off on soliciting full service restaurants till this is resolved.
Scott Morgan,Credit Card Fraud Analyst
Thank you for appreciating our coverage of the U.S. Europay, MasterCard and Visa (EMV) rollout. Green Sheet Advisory Board member Allen P. Kopelman brought up this issue in "Assessing the U.S. EMV rollout ‒ Part 1," The Green Sheet, Oct. 26, 2015, issue 15:10:02. He agreed that tips are a big issue with EMV and said, "No one can agree on this at all: tip with the sale ‒ tip adjust: who is going to allow it; who is not going to allow it. There is a lot of bad info out there from POS companies, associations, etc."
And in "Staying informed in the payments biz: a sane approach," The Green Sheet, Aug. 10, 2015, issue 15:08:01, Jeff Fortney advised, "If you primarily focus on restaurants, for example, you should understand how tip adjustments work."
Payment companies are addressing the issue. Total System Services Inc., for one, recently heralded an EMV solution for restaurants. Cyle Mims, Associate Director, TSYS Media Relations/External Communications, wrote, "Restaurants in the United States face particular challenges with the country's move to the EMV security standard. Most EMV POS software applications available in the market do not accommodate customary tip-adjustment functionality, which adds gratuities to transaction amounts after payments are authorized.
"Standard procedure in the rest of the EMV-accepting world is to complete restaurant payment transactions tableside in one step using a final payment amount. TSYS' certification of the RevChip software application helps to satisfy this need for customary tip adjustment, as well as many other sought-after EMV restaurant features, including bar tab capabilities, partial payment with low balance gift cards, and a no-signature option for quick-service environments."
We will indeed research the EMV tip situation for restaurants and publish our findings in an upcoming issue.
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