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Slow and (Un)Steady EMV Adoption (Part II of II)

Allison Ward

At Walker Sands, we have a practice area dedicated to helping fintech companies tell their story, and much of our work this past year has focused on the Europay, Mastercard, Visa (EMV) liability shift. We wanted to better understand consumer sentiments, so we surveyed 575 U.S. consumers six months following the deadline for U.S. merchants and credit card processors to adopt EMV standards or face liability as a result of any fraud losses.

As Part I of our blog series on The Switch to EMV outlined, consumers have faced setbacks with EMV cards right out of the gate and it has led to a lot of frustration. In addition to hurdles faced upfront, the study also found that overall adoption of EMV technology has been slow thus far and consumers often face an in-store knowledge gap. Here are some specific insights from the report:

Chip card adoption off to a slow start

While many U.S. credit and debit card holders received new chip cards in the mail leading up to the October 2015 liability shift, many are still not using the cards for purchases. Our study found slow EMV adoption across the board. In fact, nearly one in five U.S. consumers have never made an in-store purchase using a chip card reader.

In addition to EMV chip card use not being enforced in-store, more than one in three (37.4%) consumers have experienced a chip card reader that was not working at the time of checkout. In some cases, merchants simply use a sticky note to indicate the machine isn’t working, leaving customers questioning whether or not EMV cards should be considered a priority.

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Retail staff and consumers have much to learn about EMV

Our study found that consumers often lack EMV knowledge when they first receive or use EMV cards – but they’re not alone. The findings also show in-store staff are not well-informed on how to use EMV technology. Nearly one-quarter of consumers (23.7%) have encountered cashiers who were unfamiliar with EMV chip card readers or couldn’t guide them through the process. Also, nearly one in three (30.7%) consumers have experienced confusion when using chip card readers to pay in-store.

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To avoid some of this confusion, retailers, banks and financial institutions should implement training programs so consumer-facing staff can have a full understanding on the technology before interacting with customers. Retailers should also consider including instructions at cash registers and other POS terminals, so the customer experience can be as frictionless as possible and staff are well-poised to help customers through the process.  

The transition to EMV certainly hasn’t been easy, but that doesn’t mean merchants, credit card processors and other businesses should be discouraged. Instead, they should embrace some of these hurdles as an opportunity to improve processes the next time new technology is rolled out across the industry.

To see the full findings, download The Switch to EMV or read more in Part I of the blog series on this study.