20 Nov Enabling EMV® at the Pump: You’ve Got Options
By Bill Pittman, Senior Vice President, Sound Payments Petro Solutions, Originally published on California Fuels & Convenience Alliance
With numerous industry surveys released last year and this year, it is clear that stations are hesitant to upgrade their pump to support EMV. Conexxus survey results indicated only 15 percent of fuel retailers have upgraded. Another survey indicated that 39 percent would not be upgraded by the time of the mandate and that up to 30% were not planning on upgrading at all due to cost and inconvenience. Past survey results also revealed that stations were unaware of other upgrade options other than a full pump replacement.
With the EMV® liability mandate to support EMV payments at the pump extended to April 2021, stations have time to evaluate options to upgrade their pumps and make an informed decision.
I come from the retail payment industry. We implemented retail EMV a few years ago. There were a number of retailers that thought they did not need to implement. What happened was the fraudsters targeted those establishments so businesses that did not have much fraud before the mandate had to scramble to implement EMV solutions or risk going out of business. I think the same thing could happen to the Petro industry. Upgrading Petro is not as easy as upgrading retail because it is a more complicated implementation so you should be proactive versus reactive to minimize your exposure.
The amount of fraud targeting outdoor fuel dispensers is expected to hit more than $450 million this year. Today that burden is placed on the financial institutions. In April 2020, station owners will be responsible for that financial burden. It is easy to get cardholder data on-line and make a fake card. With the easy options for upgrading there is no reason for stations to be put in this position. If you do not have an EMV reader, you will lose the chargeback request every time. Even if you have a video of them signing, the station owner will be liable with the new mandate.
With margins low on fuel, the financial implications could be huge. It will only take a few chargebacks with large SUVs to wipe out your profits for the day. I sympathize with you on why you have to spend money upgrading your equipment to support the card associations, but you don’t have any choice if you want to accept charge cards. However, you do have options as far as the solution available.
We are seeing a transition even more now to card use and less cash due to COVID-19. In fact, according to a report from VISA®, 70 percent have changed the way they pay and contactless is growing.
There is also another benefit to upgrading right now – 1 out of 3 consumers have switched to contactless as of late. With an upgrade, you want to make sure you are supporting new technology. This may all sound expensive, but the good news is that you have lower cost options that do all of the above and check all the boxes – and these options can do it all without closing your station.
A good semi-integrated, retrofit solution that enables EMV at the pump can get the job done for you in a matter of hours on a pump by pump implementation so you don’t need to shut the station down. These new solutions also provide you with new technology like enhanced security (PCI and end-to-end encryption), QR code scanning, PIN-on-glass, MSR, and EMV chip & PIN and contactless via card tap or NFC (Apple Pay, Samsung Pay).
New systems utilize the cloud to adhere to internal systems and interfaces with standard industry protocols. Deployment and industry strategy ensures a seamless transition and minimizes downtime by phasing deployment while also giving the option to temporarily run the old and new system simultaneously
There are a few important points to consider when evaluating a retrofit upgrade:
1. Does the vendor use a semi-integrated solution at the pump or does it require a fully integrated solution?
2. Does it utilize WiFi so you don’t need to break up concrete and lay new cable.
3. Does it allow for easier scalability? What is the installation process – can you upgrade one pump at a time, or do you need to shut the station down?
4. How about security – is it tamper resistant and is it End-to-End encryption or P2PE i.e. card data encrypted at the point of entry?
The Importance of Semi-integration
Traditional industry certifications for EMV take about 6+ months to complete, which is why having multiple certification requirements is not ideal. With a semi-integrated solution there is a single certification because the device goes directly to the payment processor. For a fully integrated solution, which most of the industry supports, anytime a component in the payment flow changes such as card reader, forecourt controller or payment software changes the solution needs to be recertified – a time-consuming, expensive process.
Full integration includes the payment application as a part of the core POS solution. It handles every aspect of transaction, from reading the barcode scan or Chip on Card and pushing the credit card data to the processor to managing inventory. All card data is handled by the POS and therefore in direct PCI scope.
With semi-integration, the terminal or device used to capture customer card data is connected directly to the payment processor, so only the payment terminal needs to be certified once regardless of forecourt.
The challenge for stations is to ensure the attended POS system works with their unattended pay-at-the-pump solution and they both work with the forecourt controller. This is further complicated with EMV and the primary difference between full integration and semi-integration.
Station owners also have other options than just purchasing a new pump that supports EMV, including:
1. Some pump companies have retrofit kits for some of their new pumps. Typically, pretty expensive because they really want you to purchase new pumps.
2. You can purchase a new non-EMV pump and add a retrofit kit to it for much less money.
3. You can purchase a used pump and add EMV to it for even less money.
4. You can purchase a retrofit kit from a 3rd party like Sound Payments for a lot less money and use your existing pumps.
I encourage you to make the decision now and move forward. If you wait to the last minute, you may have a problem getting your solution implemented in time, which will put your business at risk. If you have questions about upgrade options, you can reach our team at firstname.lastname@example.org or call 844-319-5635.