EMV: The Cost of Confusion
The following opinion piece appeared in The Hill on September 28, 2016.
Oct. 1, 2016 marks the one-year anniversary since the chip-card, or EMV, deadline set by the major card brands went into effect. Prior to the deadline, the grocery industry spent more than five years and hundreds of millions of dollars to become EMV enabled. Despite the proactive efforts to meet the card networks’ arbitrary deadline, many grocers are still struggling to become EMV enabled. Over the past year, the Food Marketing Institute (FMI) has heard countless stories from members whose EMV deployment was pushed back time and again by their overwhelmed vendors. While grocers had the hardware in stores and awaited software certification, they faced an unprecedented spike in chargebacks. Grocers reported receiving tens of thousands of dollars a week in chargebacks; and some of the hardest hit had an astounding $1 million week in chargebacks. In early September, Digital Transactions put a real number on the pain being inflicted by the card brands onto Main Street retailers. They reported that American merchants will shoulder an additional $5.8 billion in chargebacks as a result of the card brand’s EMV liability shift.