Chip Card Transition, And Life as A Small Business Owner

Well, per the new rules, we replaced all of our old credit card readers (dozens) with new ones that can take chip cards (EMV).  Here is the bone pile of all the old technology, many of which were bought less than 2 years ago:


This illustrates both the best and worst of running one's own company.

The bad:  As CEO, I am actually futzing with distributing credit card terminals to the field and collecting the used ones to be recycled.

The good:  I have total control.  I was just in Washington DC, and in one meeting the National Park Service was there talking about some multi-year, multi-million dollar study to figure out their electronic payments "strategy" at their parks.  My payments strategy discussion went literally something like this:

Merchant guy:  Do you want to pay an extra $100 for the terminals to accept NFC payments (e.g. Apply pay, Android pay).

Me: Um, sure seems like the future.  Does it cost more to clear a transaction that way?

Merchant guy: no

Me:  They yes, I'll take it.

Now, we can take smart phone payments at dozens of public parks my company operates, all decided and implemented in about 30 days.

By the way, I am amazed at how many large companies like CVS appear to have the chip card readers but the store clerk tells me that they are not turned on yet whenever I try to stick my card in that slot (for those of you who don't know, the chip side goes head into a slot like an ATM slot on the front).  October 1 was the date that there was a liability shift, where merchants bear more liability for fraud if they don't take the chipcards.  Not sure how I was able to get this done in my little company but they can't manage it.

I was told by one person at CVS, a store manager but they may be off base, that they don't take the chip cards yet because they take longer than swiping.  This seems dumb.  First, many retailers for swipe cards waste time asking for the last four digits of your card, which is not necessary with the chip cards.  Further, CVS wastes a TON of time at the register with their stupid loyalty program.  Yes, I know it is a pet peeve of mine I rant on from time to time, but I have spent a lot of time waiting for people in front of me to try different phone numbers to see which one their account is under, or to waste time signing up for a loyalty card with 6 people in line behind them.  Makes me crazy.  If they can waste 30 seconds each transaction on stupid loyalty cards they can wait three extra seconds for a more secure credit card transaction.

Postscript:  It really should have been chip and pin rather than chip and signature

PS2:  Never, ever lease a credit card machine.  You pay about 4x its retail price, even present value.  I got roped into doing this for a few machines on the logic that this equipment transition was coming, and they would switch out my equipment.  But then they sold their leasing portfolio and the new owner wouldn't honor this promise, so I ended up overpaying for the old terminal (and having to pay $1000 each just to get out of the lease) and then buying the new terminals.  Live and learn.


  1. SamWah:

    The NPS, being part of our government, has too many layers of people who must be convinced that saying yes to something will not stop them from getting promoted. Getting fired? No worries; not gonna happen. But not getting promoted/raises, and transferred to an undesirable place? Ohhhhhhhh, yes.

  2. Arthur Felter:

    I can see why merchants and CC companies want EMV, but as a consumer I absolutely hate it. Swiping was so much easier and faster.

  3. Orion Henderson:

    A strategy for payments...that's just funny. Every company trying to sell something-anything-wants to make it as easy as possible for the customer to pay. Customers pay in store-accept every form of payment possible. End of story. Of course, the NPS doesn't think like that I am sure. They need to consider the interests of protected classes. Are the chips racist? Sexist? Does taking credit cards at all hurt minorities?

  4. Matthew Slyfield:

    "Are the chips racist? Sexist? Does taking credit cards at all hurt minorities?"

    More like: How do the chips impact our strategy for getting congress to increase our budget? Does taking credit cards help or hurt agency budget growth?

  5. LoneSnark:

    It takes longer to put the card in, be told not to put the card in, then swipe, than it does to just process the process the chip. I understand they don't want to be the ones educating people about how to use the chip, but the solution is to let people use either swipe or chip, not refuse the chip.

  6. EricP:

    As a Canadian, we've had the chip cards for years and it takes about as long average once you get used to it since you don't need to sign anything.

    Having been in Florida recently, you are adding the tap technology at the same time which was a second stage for us. That is MUCH faster than either for small transactions. I spent the whole vacation tapping on the scanner (like Pavlov's dog) only to be told it doesn't work yet.

  7. ErikTheRed:

    We're in the process of adding tap-and-pay (Apple, Google, Samsung) for our shop. The rate is the same, it gives our customers better protection, and there's nothing for hackers to steal. Win-win-win, and the cost of setup is negligible (maybe $1000 for hardware and labor for software updates to our back-end POS/inventory control). I use it wherever I can, and I would encourage other to do so as well.

  8. ErikTheRed:

    Especially because EMV in practice doesn't offer much more protection. Yes, it *can* be token-based but most setups don't use that feature. Tap and pay (ApplePay and its clones) are Security Done Right. I like how Apple set the standard of sharing no information with the merchants by default (not even your name)... we'll see who follows suit.

  9. mesocyclone:

    The time to process the chip is noticeably longer than a swipe. I noticed it myself a few times, and then read it in an IT trade publication. I don't know the reason - they mumbled about encryption time, which wasn't convincing to me.

  10. marque2:

    Big problem for me is that Google pay can't identify my phone as an Android phone, and therefore won't set up.

    It's a bloody Nexus 4, purchased from Google and unmodified, so it gets every Google update. How on earth can a Google app not identify Android on one of their own phones.

  11. TJSawyer:

    I don't know if it really "takes longer" but it feels like it because the chip card has to stay in the reader for several seconds until the transaction is complete. I still resent having to learn every retailer's POS payment protocol versus just handing the card over to let someone who knows how their system works handle it.

    I really agree with your observation on small business. I left a couple of Fortune 500 companies to go to a $20 million dollar a year company. Wow. No committees, no protocols - just make it work.Loved that ten years and wished I had done it much sooner.

  12. kidmugsy:

    We've had chip-and-pin for years in the UK. Thank goodness it's a mere anecdote, but the only time I've been defrauded on a credit card was with chip-and-pin. The phone call from the card company began with "Have you been in Asia recently?" and continued with "So you haven't bought jewellery in Sri Lanka?" Local gossip revealed that the probable crime scene was a particular filling station.

  13. CapitalistRoader:

    As a Canadian, we've had the chip cards for years and it takes about as long average once you get used to it since you don't need to sign anything.

    Probably just teething pains, but Home Depots in my (US) area allow me to either swipe/no sign or insert/sign. Five seconds for the former, 15 seconds for the latter. I really hope they get rid of the signature requirement.

  14. Rick C:

    I have actually had one reader refuse a swipe and insist I use the chip.

    I haven't found the chip process--when it works--to be enough worse than swiping that I don't want to use it, but in Dallas most places don't have it working yet. The first place I ran into it was Target. Most stores, even the big ones, don't yet--and oddly, Sam's Club has been taking it, but the brand-new Wal-Mart next door doesn't. Or rather, it tries to, but times out after about a minute.

  15. Q46:

    Chip and pin here in France for over 15 years. It is no longer than swipe, because no wait for a piece of paper to sign, search for pen, then for another that still has ink left, then the signing process.

    Whether swipe or plug in, the info still has to be processed irrespective of whether the card is in the machine or not.

    The chip is more secure because a magnetic strip can easily be copied and put on a fake card and signature forged. That cannot be done easily with a chip and the PIN is needed at whch you get only three attempts.

  16. Not Sure:

    I was at the minimart this morning, waiting in line while the people in front of me fiddled with their cards (slide again, receipt/no receipt, etc.) and then when it was my turn, handed the clerk cash for my purchase and was out the door quick enough that the person ahead of me in line was still holding it open. But then, that's just me...

  17. Mike Powers:

    Think about which major retailers have either just had a major scandal regarding credit-card skimmers, or are most likely to have someone with a faked card try to buy something. And that's who's going hard for chip-card usage. Everyone else has looked at customer-satisfaction-versus-fraud and said "nope, we're swiping until they physically remove the swipe terminal from the stores".

  18. Rick C:

    Yup--Target, for example, was the first major company I saw that was using chip cards, and I'm pretty sure also the one that wouldn't let me swipe.

    Using the chip card isn't exactly rocket science. You put your card into the slot during the transaction and wait a couple seconds after the cashier hits total, and then (ugh) sign or put in your pin. Everyone with a debit card's already got a pin anyway so the idea that they would get confused by that seems overblown.