Banking
accept the cards for purchases. The new termi- nals must be tested and certified by processors or payment providers before they can be used. “Retailers are very frustrated,” says Jodi
Roth, director of government affairs in the Richmond office of the Virginia Retail Federa- tion. “They have had the time to get ready and have paid to have the hardware, but it’s just sit- ting there until the software is installed.” Software vendors test the terminals and
get them up and running. These vendors “can’t keep up with demand, but that’s a disservice for our retailers,” Roth says. Because they haven’t been able to use
chip-card technology, some retailers are seeing a growing number of chargebacks for fraudu- lent purchases. “They could be over $1 mil- lion a week for some midsize to large retailers,” says Liz Garner, vice president of the Merchant Advisory Group, based in Minneapolis. “Some have had an over 1,000 percent increase in chargebacks, and it’s not really their fault. They aren’t able to get the certification done.” CNN Money reported that four grocery
stores in California, New York and Florida are seeking class-action status in a lawsuit they filed against four major credit cards compa- nies seeking to recoup their expenses in con-
verting to the chip card system. The plaintiffs call the switch an industry conspiracy that violates free- trade laws.
Speeding up purchases MasterCard and Visa say they are mak-
ing strides in terminal testing and simplifying the certification process, which varies from one retailer to another. The more complex a retail- er’s point-of-sale system is, the more tests are required. At stores where chip cards are being
accepted, another problem has cropped up. Many consumers complain that their chip-card purchases can take two to three seconds longer than normal. To address the issue, Visa this spring
began offering merchants Quick Chip technol- ogy to speed up chip-card purchases. The tech- nology enables customers to remove their chip card from the terminal without waiting for the transaction to be finalized. In April, MasterCard introduced M/
Chip Fast, a new software for retailers based on “tap-and-go” technology, also designed to speed up chip-card purchases. Tap-and-go is a contactless method of payment where the card is simply touched to the screen.
SUCCESS FEELS GOOD WHEN YOUR BANK TREATS YOU LIKE FAMILY.
“Consumers understand why we are
changing the way we pay for things when we explain that this is keeping them safer,” says Kitchener of MasterCard. Progress in the conversion is continu-
ing. In the MasterCard network, 33 percent of all merchant locations in the U.S. are chip active. That means 2 million stores can now accept chip cards. Visa reports that an aver- age of 23,000 new merchant locations become chip ready each week. It now has 1.46 million chip-ready locations. Approximately 35 per- cent of merchants using Visa in Virginia are chip enabled. The good news is that chip cards are help-
ing to fight fraud. Visa saw a drop of 47 per- cent in fraudulent purchases at chip-ready merchants in May compared with a year ear- lier. MasterCard saw a 54 percent decrease in fraud from April 2015 to April 2016 at U.S. retailers who have completed or are close to completing their adoption of chip cards. Anytime a new technology is put in “the
largest economy in the world there will be some necessary modifications and enhance- ments and that is what we are seeing,” says Johnson of the American Bankers Associa- tion.
Founded by five families in 1959, Madison Wood Preservers has built its successful wood treatment company on a foundation of trust and personal service – traits the company also looks for in its bank. Says Madison Wood CEO, Bill Price, “Union said they could do the job we needed and that’s how we found Jerry Raines. We call him Uncle Jerry because he feels like family.” It’s a relationship that builds just the right framework for success. Visit
bankatunion.com to learn more.
1.800.990.4828 Union Bank & Trust
30 NOVEMBER 2016
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