MasterCard unveils M/Chip Fast to speed up EMV transactions

Dive Brief:

MasterCard on Wednesday unveiled M/Chip Fast, a new application that it says will bring EMV transactions close to the speed of traditional magnetic-stripe cards.
The M/Chip Fast technology, which can be added to existing point-of-sale systems that accept MasterCard, allows customers to remove their EMV-enabled cards from terminals more quickly. As with standard EMV transactions, M/Chip Fast creates a unique code for each transaction to prevent counterfeit fraud; once the code is generated, however, the card can be removed from the reader, which MasterCard said slashes processing time and reduces the cardholder perception of a prolonged checkout experience.
Visa and Wal-Mart Stores also recently made moves to speed up EMV transactions by several seconds.

Dive Insight:

Reading an EMV card requires the card to be held by the point-of-sale terminal for several seconds longer than the instant-read swipe transactions that consumers are used to. Many retailers have bemoaned the added friction that the more secure EMV credit cards introduced, slowing retailer rollouts and hampering wide use.

Just a few extra seconds turns what is otherwise a fairly mindless micro-task is a big ask of some consumers. And, it turns out, it’s also fairly expensive.

The Wall Street Journal, citing a survey by JDA Software, notes that a chip card piles on some eight to 12 additional seconds per check-out, in part because people are still getting used to using the cards, attempting the traditional mag-stripe process firest, or requiring attention from the clerk. At one retailer JDA studied, the additional transaction time could add $3.2 million to annual labor costs.

But retailers that haven’t found EMV transactions to be a problem may want to skip the M/Chip feature, Ajay Bhalla, president of security solutions for MasterCard, told PYMNTS. Those most in need of it will likely be businesses where shoppers are in a rush, like when they’re getting coffee or fast food, or hopping on the subway.

“We think that [M/Chip Fast] should only be used by institutions that actually see it taking much longer to process a transaction than standard EMV,” Bhalla said.

Some 42% of retailers across the United States still require customers to swipe their credit cards, even though chip-enabled EMV cards have been the rule since Oct. 2015, according to a study published last month by personal finance website CardHub. Retailers that fail to implement EMV cards could be liable for more than $8 billion in fraudulent transactions each year.