AUSTIN, Texas–A new report from Software Advice has found that a significant number of U.S. retailers do not have a POS system in place that is compliant with the upcoming EMV payment standard, including a “surprising” finding that many retailers believe it’s all unnecessary.
Those findings follow separate research from Software Advice released earlier that found one-quarter of retailers were unaware of the standard, which goes into effect Oct. 1.
The new research has found that 64% of single-store retailers don’t have a POS system in place to handle chip cards. On Oct. 1, the EMV standard holds liable the party that is least secure in its technology in the event of fraud.
Retailers that have yet to adopt a POS system have cited factors such as cost and implementation time as reasons for the delay, even though the operational benefits of a POS system, including time saved on both the front and the back end, greatly outweigh the costs.
Nevertheless, Smart Card Alliance said it found that 23% of retailers believe the EMV readers are unnecessary.
“Given the severity of not complying with EMV, one would think there’d be some urgency among retailers to adopt EMV capabilities,” the company said. “However, since that doesn’t seem to be the case, we asked retailers who don’t have EMV readers in place why they’ve yet to transition. The most surprising finding here is that nearly one-quarter of retailers find EMV compliance unnecessary. The potential negative ramifications of not having EMV capabilities are staggering—so the fact that so many SMB retailers find EMV readers less than vital is mind-boggling.”
Software Advice quoted Randy Vanderhoof of the Smart Card Alliance as noting, however, his belief that merchant adoption rates will jump as soon as they start feeling the negative consequences, including getting “socked with a large chargeback.”
“Retail operators are undoubtedly a busy bunch, which is perhaps articulated by the low percentage of retailers fully understanding the liability shift,” the company said in releasing its research. “It would serve retailers well to dedicate some time to sit down and really absorb what the EMV standard means for them and their business.”