Migration to EMV Technology at the Gas Pump
EMV is a technical standard for smart payment cards and for payment terminals and automated teller machines that can accept them. The standard was created in Europe by Europay, Mastercard and Visa. A consortium of Visa, Mastercard, JCB, American Express, China UnionPay, and Discover created EMVCo to manage and evolve the EMV®1 Specifications and related testing processes.
There are two types of transactions that will be available from credit card issuers; chip-and-signature and chip-and-PIN. A chip-and-signature card is just like the magnetic stripe credit cards. The point of sale terminal will read the chip and create the transaction. A signature is required to verify the transaction just as current magnetic stripe cards do.
For chip-and-PIN transactions, the cardholder is required to enter a personal identification number (PIN) instead of signing a paper receipt to provide identification. The EMV chip card is more secure than traditional credit cards because the data transferred during the sale is only good for that transaction. A hacker can read the data, but would never be able to duplicate it, like they can on a magnetic stripe card.
EMVCo provides Best Practices documentation for financial institutions, vendors, and other interested parties to help reduce the likelihood and impact of any potential problems or issues that might arise from an EMV Chip implementation. The ISO/IEC 7816 and ISO/IEC 14443 standards specify how contact and contactless cards are implemented. Improved security and the possibility for finer controls of “offline” credit card transaction approvals are the two major benefits of moving to EMV based credit card systems. More information about the implementation, vulnerabilities and history of EMV technologies can be found at Wikipedia.
Deadline for EMV-certified Payment Platforms is Approaching
Fuel Retailers in the U.S. have an October 2017 deadline for integrating EMV-certified payment platforms in their gas dispensers. This requirement is part of the liability shift implemented by MasterCard, Visa, American Express and Discover for pay-at-the-pump at gas stations. If your business does not covert to the EMV platform, banks and credit card companies will be able to place the liability of fraudulent transactions onto the merchant.
Retailers are encouraged to upgrade pay-at-the-pump equipment in advance of the deadline to minimize disruption and downtime. So far, the migration of EMV compliance has been slow. About 25% of U.S merchants have EMV compliant systems compared to Canada which had an 80% adoption rate by June of 2015. Of the hardware implemented in Canada, 90% were new dispenser installations and 10% were upgrade kits.
EMV Upgrade Solutions
Gilbarco Veeder-Root, a retail and commercial fueling operations manufacturer, has seen increases in EMV compliant dispenser sales as regional retailers upgrade their dispenser platforms. Gilbarco also offers retrofit kits for their Encore and Advantage dispensers. The FlexPay II Retrofit Kit combines an EMV-certified payment system with color screens. The kits integrate seamlessly into dispensers using the Encore S technology and better position retailers for future regulations and advancements in mobile payment.
The other leading fuel dispenser manufacturer, Wayne Fueling Systems, provides a complete EMV solution that features modular payment hardware to minimize disruptions caused by “ripping and replacing” equipment. The Wayne Connect network solution allows you to use existing site wiring to enable EMV-ready devices. This solution provides TCP/IP connectivity which is more efficient for high volume EMV transactions. Compared to payment cards with magnetic stripes, EMV transactions require ten times more data per transaction. The Wayne Ovation and Helix are EMV capable dispensers. In order to retrofit an existing Ovation or Helix dispenser retailers can purchase the iX Pay Secure Payment Platform.
Every EMV-enabled terminal must be certified by EMVCo. EMV testing is divided into three levels. EMVCo handles level1 and level 2 certification at the hardware and software level. The certification is meant to ensure the interoperability of standards between brands and the security of the device. Small business owners do not have to worry about Level 1 and 2 unless you have custom software applications at the dispenser. Level 3 is an end-to-end certification that checks the integrity of the payment chain by testing every type of transaction that the dispenser equipment can handle. If your business’ payment-system implementation is relatively simple with few or no customizations, then most of the Level 3 certification may not apply to your business. Small Businesses can learn about the entire migration process, including a step-by-step guide, at Intuit.
Scheduling an upgrade will be more difficult as the deadline approaches since technicians at equipment installation companies may be stretched to meet the conversion demands. A change to the gas dispenser payment system will also trigger a recertification by Massachusetts Division of Standards or New Hampshire Weights and Measures. Retailers must ensure the scope and requirements are correctly identified to ease the conversion process. Training of retail associates is another requirement. Sales associates need to understand the basics of EMV and how to handle exceptions. Customers will be unfamiliar with the new system and may try to use the magnetic stripe cards. Sale associates can alleviate delays at the register if they are trained to walk customers through the new transaction. Retailers that implement and test new transaction processing systems before the deadline can avoid interruptions to their operation.
EMV specifications and updates to these standards are available for download at EMVco.