Only 27 percent of U.S. merchants will be EMV-ready by the October 1st liability shift, down from 34 percent estimated in March, according to a survey by the Strawhecker Group (TSG) released Thursday.
By December 2015, 44 percent of U.S. merchants are expected to adopt EMV, however EMV-readiness will not reach a threshold of least 90 percent until 2017 more than 15 months after the shift.
EMV, or “Europay, MasterCard, and Visa,” is a globally accepted card standard that uses an embedded microchip to provide unique data protection when the card is inserted into a chip-card reader. Most card-accepting U.S. merchants may be liable for fraudulent transactions if they are not “EMV-ready” by October 1, 2015.
“Though the cost to become EMV-ready may be substantial to many, merchants with fraud exposure should get ready for the liability shift,” says Mike Strawhecker, Principal at TSG. “This would include merchants that are targets for fraudsters because they sell items that might have high value and/or can be easily resold such as electronics, household appliances, and jewelry.”
EMV may not be as much of an issue for certain merchant types, such as restaurants for example, that have a lower likelihood of fraud. One survey respondent said, “I think that EMV is being overblown in terms of urgency for the vast majority of merchants in the U.S.”
TSG, a management consulting company focused on the global payments industry, found that the three biggest hurdles slowing EMV implementation are processor readiness, gateway readiness, and replacement point-of-sale (POS) terminal readiness. The results were based on a sample of 62 payment service providers.
“With low EMV-readiness estimated just two weeks away from the deadline, it is clear that this process has been far more complicated than in other geographies where it has been implemented before, due to the sheer size and complexity of the payments industry in the U.S.,” added Strawhecker.
TSG’s sample included 62 payment service providers that service 2.42 million merchants, or over 25 percent of the U.S. card-accepting market. In conjunction with this release, TSG has published an infographic to express the findings – http://bit.ly/EMV-Infographic.
The Strawhecker Group (TSG) specializes in providing financial institutions, merchant acquirers, card associations, ISOs, processing companies, large merchants, and the investment community with advisory services to maximize their growth and profitability.
