Many factors are responsible for the major changes taking place in the U.S. payments landscape, but one of the biggest comes down to three little letters: EMV. If you’re at all responsible for EMV acceptance for your restaurant, you’ve no doubt been hearing and reading about the October 2015 liability shift that has already given a big boost to EMV’s momentum.
First, a quick review. EMV (the initials stand for Europay, MasterCard and Visa) is a global set of payment industry standards that has been around since the 1990s. It’s only new to the U.S.; in fact, this is the last major market to make the transition to EMV acceptance.
EMV acceptance centers around the use of payment cards equipped with microprocessor chips, which major card issuers have already been sending out to U.S. customers. These “smart cards” generate dynamic data in the form of a unique code for each transaction. In contrast, the data held on traditional magnetic strip cards is static, so if the card data is stolen, it’s relatively easy to use it for fraudulent transactions or to manufacture a counterfeit card. The chips embedded in EMV-compliant cards limit the scope of potential data breaches and make the cards themselves more difficult to counterfeit, increasing payment security for both consumers and restaurants.
The liability shift means that, as of October 1, 2015, restaurants without the ability to handle EMV transactions may be held responsible for fraudulent charges made with these cards. Card issuers are also encouraging EMV acceptance with incentives, such as reduced PCI scope and processing fee reductions.
The bottom line, however, is that restaurants will need to upgrade their POS systems to become EMV compliant. POS hardware will need to be able to read chip cards, which are “dipped” rather than “swiped” as mag stripe cards are. Both staff and guests will need to be educated in new payment processes.
In table service restaurants, another security measure associated with EMV acceptance could promote the growth of pay-at-the-table POS technology. “Chip & PIN” and “Chip & Signature” requirements mean that rather than having a server take a payment card from the table back to a POS terminal, the card will never leave the customer’s sight.
This provides an opportunity for table service restaurants to deploy multi-function mobile POS hardware capable of reading EMV cards. These could take the form of tablets that may also be used to take orders, provide information on menu items to answer guest questions, and to quickly and accurately transmit orders to the kitchen or bar. Servers could spend more time taking care of guests, improving customer service and increasing table turnover rates.
In the quick service restaurant environment, where keeping transaction times low is a business imperative, accepting EMV will require installing POS hardware capable of quickly reading chip-enabled cards. This will require extensive and ongoing training of cashiers so that they understand the differences involved in handling EMV, mag strip, and NFC payments. (An important point to note, while upgrading your hardware to accept EMV transactions, consider also ensuring you have the ability to process NFC transactions. NFC is a fantastic way to speed up transaction times and deliver better service faster to customers.)
In addition, for the many QSRs offering guest-facing payment hardware, cashiers will need to be trained in how to walk customers through new payment processes. Their efforts should be supplemented with clear, easy-to-follow signage combining text and images. The investment in both training and support will pay off in faster, smoother transactions during the EMV transition period.
EMV acceptance is no longer an option but a fact of life for hospitality organizations. For table service and quick service restaurants, the new standards offer greater data security, as well as opportunities to invest in technologies capable of differentiating you from your competitors.