Article

How restauranteurs can take the fear out of EMV transition

With the right expectations, education and planning, restaurateurs may turn EMV's perceived challenge into an opportunity to build customer loyalty.

September 7, 2015

 By Andy Sirmon, NCR Corporation, Hospitality

The EMV (that’s EuroPay, MasterCard and Visa) liability shift will take place Oct. 1. After that date, liability for chargebacks due to fraud will shift to the party that is least EMV compliant. So between the bank that issued the card, the restaurant accepting the card and the payment provider processing the card, whichever party that is least prepared to accept EMV will be held liable for that fraudulent transaction.

Run a Google search on EMV, and you’ll come up with all kinds of technical explanations about EMV, and you’ll also find a lot of misinformation about it. While it’s important to eventually make the transition to EMV to avoid liability and minimize risk for your business, as well as to increase cardholder security for your guests, restaurant operators should be armed with the information they need to easily get educated on this topic and be in control of when and how to implement EMV. In fact, with the right expectations, education and planning, restaurateurs may turn this perceived challenge into an opportunity to build customer loyalty.

EMV effect on operations

When looking at the liability shift and transition to chip-based credit cards, many restaurant operators have focused on technology changes, specifically the costs of purchasing and implementing EMV-compliant equipment, such as new payment terminal devices. Restaurant operators may not be looking at all of the operational changes that may result from implementing EMV, such as the effect on their employees and customers, as well as the overall speed-of-service in the restaurant.

It is crucial that operators understand the effect EMV technology will have on restaurant operations. To begin with, customers will need to insert, or “dip”, EMV chip cards into new payment terminal devices, as opposed to swiping their credit cards as has been custom for many years. This means the card will need to stay in the payment terminal for the duration of the transaction, adding many more seconds to the payment transaction. If a customer removes the card too soon, the process starts all over again, adding even more time and possibly resulting in initial frustration, both from the customer and others who are waiting in line.

This loop at the point of sale may irritate customers, so employees need to be armed with the right information and attitude to help customers tackle any challenges at the POS. Currently, many restaurant employees are still unclear of what EMV is and, more importantly, how it will change operations.

Owner/operators can educate employees to ensure they clearly understand how operational flows and processes will change within their restaurants. Especially in the immediate days after converting to EMV, customers may be confused about their credit cards or have difficulty using the new payment terminals.

To help customers with this new process, as well as keep lines moving, staff should be trained on the new processes involved in accepting EMV payments, particularly in detecting the difference between chip and magnetic stripe cards before the transaction – this will help process the payments correctly. Having staff ready to help customers by instructing them on how to insert their new credit cards in the devices, as well as letting them know when they can remove their cards, will help keep the lines moving steadily in this new EMV world.

Because of these slower transaction times and the longer wait times that will result, even customers who aren’t yet carrying chip and PIN cards may have a different service experience in their favorite restaurants that have transitioned to EMV acceptance.

As a result, many operators will look to see how they can improve their transaction flows, especially centering on how they can improve their speed of service. One such way is by accepting mobile payments, such as Apple Pay or Android Pay, in addition to EMV. The speed of a mobile payment transaction is much faster than that of an EMV transaction – in fact, it’s almost as fast as swiping a magnetic stripe credit card — and mobile payments also can provide enhanced card data security for consumers as well.

Conclusion

Industry experts estimate only 20 to 30 percent of cardholders in the U.S will have new EMV-ready cards by Oct. 1. Moreover, many experts predict it will take at least three to five years for EMV to reach full acceptance in the U.S. Know that it will take a while for everyone to finally transition to EMV, and that you won’t be left behind if you choose to wait until after Oct. 1. It’s important to understand the business implications of EMV acceptance — and its impact to your operations — in order to make the right decision for your establishment.

Operators who choose to transition to EMV acceptance can use the Oct. 1 timing as an opportunity, rather than a hindrance, in elevating employee and customer education while implementing technology solutions designed to address current and future payment needs. By educating customers through in-location literature, on social channels and in-person discussions, restaurant owners and operators can remove the mystery around EMV and provide customers with a clear reason behind what may amount to slightly slower service. Additionally, by enabling mobile payment capabilities, operators can provide greater convenience and speed-of-service to their customers.