New Security Standard EMV is a 'Money Pit' for Retailers

by Sarah Grotta 0

Business Insider reported on that merchants are not pleased with the prospects of integrating EMV capable terminals in their retail locations and are generally unconvinced of any financial benefits:

“But the transition to EMV is a colossal waste of money for retailers, according to a report from research firm IHS Group. The report argues that, for a $1 billion specialty store, the return on investment for upgrading to the new standard is -77% over 3 years. The report cites additive security costs, degraded consumer experience, labor costs, and the ineffectiveness of EMV for protecting online channels as reasons why the migration to EMV doesn’t make sense.”

The article also reports that regardless of merchant sentiment, nearly all merchant terminals available today are EMV capable and terminals that accept magnetic strip only cards are hard to find.

It’s important to note, however, that just because the terminal is capable of EMV doesn’t mean the function has been enabled. Merchants may choose not to process EMV transactions until after the holiday rush is over, not wanting to risk consumer confusion or operational problems.


Overview by Sarah Grotta, Director, Debit Advisory Service at Mercator Advisory Group

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