Wait No More: Quick Chip Technology Speeds Up EMV Transactions

May 2, 2017         By: Dan Geraty

Nearly half of the world’s credit card fraud happens in the United States. Yes, you read that correctly. EMV technology, which includes chip cards and smart cards, goes a long way toward preventing in-person payment card fraud, but U.S. businesses continue to drag their feet: Currently, only 38 percent of businesses have implemented the technology. One commonly cited reason: the slow checkout process.

It’s hard to blame them when chip card transactions take anywhere from 15 to 30 seconds, whereas swiped transactions are almost instant. But that excuse won’t cut it anymore: Quick Chip for EMV technology brings transactions up to speed with a normal credit card swipe.

Everybody Wins With Quick Chip Technology

Beginning in October 2015, costs associated with fraudulent activity shifted from financial institutions to merchants if their business failed to provide EMV-compatible equipment. Designed to combat credit card fraud, the measure increases the risks for businesses that haven’t embraced EMV: The party least equipped for EMV transactions, whether the issuer or merchant, assumes all liability. If a counterfeit chip card is run through a magnetic stripe terminal, the merchant will then have to assume responsibility.

The security benefits of EMV equipment are, of course, their own source of motivation. According to Visa, instances of counterfeit credit card fraud fell by 47 percent from 2015 to 2016 due in large part to businesses upgrading their equipment to accept EMV chip transactions.

Of course, nobody’s complaining about securer payment options. But we’ve all experienced the frustration with EMV transactions: In a hurry at the checkout line, you insert your card in the reader … and you wait. Time slows down while you stare at an unfriendly “Do not remove card” message. In a flash, the reader begins to beep almost menacingly at you to remove the card. You long to return to the good ol’ days when you could simply swipe your card and move on.

In short, the original EMV technology doesn’t exactly deliver a stellar consumer experience. And while 30 seconds can feel like an eternity when you’re the consumer, to the business owner this delay creates a chokepoint in the checkout process. This means more employees need to be hired to appease frustrated shoppers and try to compensate for longer lines, which adds up to lost revenue and decreased consumer satisfaction. In other words, it’s a problem.

The new Quick Chip technology solves this problem, bringing EMV transactions up to the speed expected by both businesses and their consumers. It offers the same experience as swiping, plus it allows consumers to do something they never could with chip cards: insert a chip card before the final amount is known and then put the card away. For regular EMV transactions, consumers have to wait for the transaction total to be known before they can insert a card. With Quick Chip technology, chip data (cryptogram) is stored in the terminal before a final amount is known. This allows the consumer to insert her card sooner in the process. This, coupled with the reduced time the card needs to be in the terminal, speeds up the checkout process and gives consumers a user experience similar to a swipe transaction.

The Ins and Outs of Implementation

Whether a business accepts card payments on a standalone terminal or through its point of sale system will determine how and when it’ll be able to adopt quick chip technology.

Businesses using standalone terminals will have the easiest time getting Quick Chip. A business can either purchase a standalone terminal with Quick Chip technology already loaded or download a simple software update on its existing EMV-ready terminal.

Many businesses rely on their point of sale providers to supply EMV solutions. POS providers are faced with a different kind of EMV waiting game than consumers. While they might have integrated their solutions into a few different payment processors, they are required to go through a lengthy certification process with each one to offer EMV.

Certifications are another big issue in the adoption of EMV standards. Among retailers with nonfunctioning but installed equipment, 57 percent are waiting on certifications. Of those on the waiting list, 60 percent have been waiting at least six months.

Quick Chip, Lasting Benefits

As a business owner, you may soon start feeling the pressure to implement Quick Chip technology, if you haven’t already. As you weigh the decision to switch, keep in mind the following benefits of doing so:

  • It will help you preserve trust with your consumers. Now that Quick Chip technology is curing woes shared by consumers and merchants alike about chip card payment, the security of the new cards will take center stage. Instead of being relieved they can swipe to pay, consumers will begin to wonder why merchants still aren’t supporting the securer chip cards given to them by their banks.
  • It will improve the customer and employee experience. Educating employees on what to expect with the new technology means fewer issues at checkout and a better consumer experience overall. Many European consumers already have chip-enabled cards, so by implementing this technology, you’re improving the experience for foreign consumers, as well.

Ensuring that your entire team has a baseline familiarity with the new technology will allow you to provide a more seamless consumer experience and make onboarding new hires easier.

  • It protects you from counterfeit card fraud and the resulting chargeback expenses. If you’ve refrained from implementing EMV due to the slow checkout process, Quick Chip is the answer for your worries. You can get the security and chargeback protection of EMV while maintaining a good, speedy checkout experience for your consumers and employees.

Before taking any action, you need to know this: Implementing Quick Chip technology could require time and money. If you already have an EMV-ready terminal, the upgrade is as simple as downloading and installing the new software. If you’re a POS provider, it will take more effort to adopt this latest technology. Knowing your costs in terms of time and money is integral to planning effectively.

Dan Geraty is founder and CEO of Clearent, a full-service payment processor that built its proprietary platform from the ground up. Dan founded Clearent in 2005 in his hometown of St. Louis, Missouri. Since then, it has earned a spot on the Inc. 5000 list of fastest-growing companies for five straight years and continues to climb the Nilson Report’s list of Top Merchant Acquirers in the U.S.

Dan has more than 15 years of senior executive experience in both startups and established companies. Before joining Clearent, he was president and COO of Dynamicsoft, a venture-backed network software and systems company, which was purchased by Cisco Systems.