Although there has been an uptick in merchant EMV adoption since the October 2015 liability shift, this adoption rate is slower than anticipated. Only 37 percent of U.S. merchants can accept EMV chip cards.
This slow merchant adoption may be due to a number of factors, including:
- Associated costs such as new EMV-enabled card readers
- The length of time it takes third party vendors to go through the certification process
- Potential consumer confusion leading to longer checkout lines
Merchants that have not adopted EMV technology have suffered increases in counterfeit losses. To combat these fraud increases, some merchants are choosing to pull gift cards from shelves and/or set limits on these cards, due to the cards’ magnetic stripe functionality (Merchants remain liable for fraud carried out on mag-stripe gift cards). Also at issue, some merchants have EMV-capable terminals but have not yet activated the EMV functionality. This makes the merchants liable for any fraud resulting from transactions completed at those terminals.
