By Steven Feldshuh
Merchants' Choice Payment Solutions East
If I were to write an article on how the major card brands Visa, Mastercard, Discover Financial Services and American Express Co. are educating cardholders and merchants about EMV (Europay, Mastercard and Visa), it would be very short. The reason? They are missing in action. Sure, some of their websites contain general information on EMV. But are they spending any advertising dollars to convey the importance of EMV to cardholders and merchants?
From what I see, Visa and Mastercard spend an enormous amount of money preaching the benefits and the amazing rewards attached to their credit cards. They budget multiple millions of dollars to promote Mastercard's "priceless" qualities and Visa's constantly changing messaging regarding its cards. Yes, much is at stake here for these publicly traded companies to grab market share. But when Visa and Mastercard make $4 billion and $1 billion in profits, respectively, in one quarter, shouldn't they be putting some of that money to work for the benefit and security of the businesses that makes them tick?
I have been hunting for an ad on the importance of merchants insuring that their customers are able to process their chip-based cards correctly. I have yet to see one. I also have seen no ads warning cardholders to shop only with merchants who have updated their card acceptance with EMV capabilities.
Yes, I have to say I did receive a statement stuffer on EMV with my latest Chase card, but, no, it wasn't very convincing. It was just Chase preaching about how it was going to protect me. As my card issuer, Chase obviously had to explain the reason for my new chip card, but Chase isn't Visa or Mastercard.
So the questions become: Why isn't Visa insisting consumers be told to make sure they use their cards only at EMV-capable merchants? Why isn't Mastercard telling merchants it is of the utmost importance that they insure the integrity of their customers' chip cards by using EMV capable systems that are programmed to properly accept EMV cards?
Where are we almost two years after the EMV liability shift deadline for most merchant verticals came and went? While on a family vacation in Charleston, S.C., I decided to see who accepted EMV cards and who didn't. I basically found the same results to be true in Charleston as I did in New York, where I live and work.
My research while on vacation wasn't scientific, of course, but I also checked with a terrific reference on these things: Tim McWeeney. He validated my findings that hotels, restaurants and lots of larger retailers still haven't been moved over to EMV technology.
The hotel we stayed at, The Meeting Street Inn, still swiped cards. When I asked the hotel manager why the establishment couldn't process my chip-based card properly, he blamed his POS company for not providing a solution. Not being EMV compliant seems to be the case with most motels and hotels that are using POS systems.
A few blocks away, I asked the server at Hank's Seafood Restaurant the same question I'd asked at the hotel. She brought over the manager. He said it was too expensive to upgrade to EMV, but his restaurant group was looking at doing pay at the table, and no decisions had been made. Again, from what I have seen and read, most sit-down restaurants are still swiping cards.
The representative at my car rental company, Thrifty, had no idea what I was even talking about when I questioned why my EMV card was swiped. Charleston has a nice shopping area on King Street. My wife was glad to go into several stores with me so I could see what the owners of those stores were doing. I found about 20 percent of the retail locations accepted EMV cards.
So, hotels, sit-down restaurants, coffee houses and cafes, and most retail businesses I encounter two years into our transition to EMV, still are not doing what they should be doing to protect cardholders' information or prevent potential chargebacks at their own businesses.
Whose fault is it? My processor and equipment vendors Verifone, Pax, Dejavoo, and Ingenico began preaching about EMV well before October 2015. Were these companies fully ready to take on EMV? Probably not, though some did implement the technology in a limited way. Within a few months of the deadline, we did have some capability and solutions to take into the field.
Over the past year, we have been continually reminded and encouraged to upgrade all of our merchants, and I know most of you are doing that. I'm still not sure why Hypercom T7Ps and Nurit terminals, for example, are still deployed and functioning.
I think processors have been doing what they can with statement messages for merchants and on educating their sales offices. The equipment manufacturers have much to gain by getting the message out, so they are on board. I strongly believe the EMV message isn't coming across because the card brands, which have the most influence and the largest advertising budgets, are not being heard from.
Yes, they have implemented time frames for us all to get our merchants updated. But why aren't they directly selling the concept to merchants and to their cardholders? Remember, without the merchants, there would be no processing. From a sales office point of view, getting our merchants set up properly with EMV could certainly use a boost from the card brands. It's time for the card brands to do more.
If I heard on television or through social media Visa, Mastercard, AmEx or Discover stating, "Only use your credit or debit card at a participating merchant that accepts your chip-based card," I would listen, especially if they scared the pants off of me by mentioning the possible repercussions of not doing so.
Imagine if the card brands told the merchants, "You have a deadline: December 2018. If you don't start accepting chip-based cards properly using an EMV system, we are going to ensure you can't continue processing." Harsh, yes, but messages like that would result in some quick movement by merchants.
So maybe our friends at Visa, Mastercard, Discover and American Express can think about pushing EMV during the upcoming football season or during the winter Olympics. Advertising campaigns focused on EMV implementation might not provide more card issuing opportunities, and it isn't a sexy topic for them. But it might just do what the rest of us haven't been able to do: get every merchant EMV compliant.
Steven Feldshuh, President of Merchants' Choice Payment Solutions East, has 18 years' experience in sales and ISO development. Directly prior to joining MCPSE in 2012, he was President of Payment Partners. In his current position, Steven devotes the bulk of his time to assisting agents in building their portfolios. Contact him by email at firstname.lastname@example.org or by phone at 212-392-9202.
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