tmiw

D582

No, the store should have been able to serve the same number of people per hour regardless with a properly implemented system. People perceive it to be faster because their card is not in the terminal for as long, but the end-to-end time in almost all cases is barely different. Quick Chip (and its ugly step-brother Quick Contactless) is a band-aid solution to mask the more fundamental technical problems in the US payments ecosystem at the expense of security.

With regards to Square, it is truly only perception. The total amount of time from card presentment to authorisation to transaction finalisation (receipt selection etc.) is the same.

tmiw

Even in the ideal case, EMV still has overhead over swiping. Let's take Walgreens, for example (one of the better EMV implementations without QC). Per the video below, authorization took 2.3 seconds while the chip read steps before authorization took 2 seconds:


If Walgreens were to ever get QC, that last 2.3 seconds would be "gone" from the perspective of the cardholder (as people were accustomed to that time and mostly ignored it pre-EMV). Additionally, the remaining extra amount of time would likely be lower on average (and possibly go away altogether) as many would choose to insert/remove before their transactions are totaled.

Anyway, would it be worthwhile for Walgreens to implement QC? Maybe not, but a lot of businesses definitely would. In fact, many were perfectly okay with never implementing EMV otherwise because those extra couple of seconds matter to them more than the possibly minimal additional costs from the added liability--not to mention that I suspect card use did in fact drop in the US, even if only by a little bit with certain demographics/situations. Because of those factors, I suspect the networks didn't have much choice considering EMV isn't mandated by law.

BTW, the authorization time could definitely be improved overall. The easiest way (minimizing infrastructure upgrades on the merchant side) might have been to allow offline-preferring terminals for certain merchants/transactions and require some/most cards to be able to authorize offline, but that was apparently a nonstarter for reasons mentioned before. Other solutions might require changes outside of the networks' control (like better availability/pricing of broadband).

wco81

Just ordered something from B&H.

On their website through the browser, they display Apple Pay as one of the payment options. But my Mac doesn't have a TouchID sensor. Assuming that's mainly for people with the touch bar MacBook Pros.

So I went to my iPhone, opened their app., and ordered it using Apple Pay there. First time didn't go through so waited a couple of hours and then got order confirmation from B&H.

However, I have not gotten confirmation from my credit card yet. Usually when I order something from Panera, the alert is instant, at least when using Chase cards. Maybe Citi isn't as quick.

tmiw

If you're using Safari on your laptop and have a supported iPhone or Apple Watch, it'll still work. You'll just be authenticating on those devices instead of the laptop.

D582

But all of this supposed time savings accounts for maybe 2-3 seconds, assuming every other aspect of the transaction is as efficient as possible (which it often is not). The payment networks totally botched the EMV conversion in the US on many fronts, but QC is just a band-aid fix in all of that for a problem that shouldn't have existed in the first place.

tmiw

It's probably still the best of the available options given everything that's happened thus far. The others include:

Suspend the liability shift altogether until some future date: sets a precedent that may make it more difficult to set newer standards in the future (and possibly making it more difficult to revisit EMV itself).
Push contactless payment: could require 5+ years to "take" among the public--if it ever did. In the meantime, more and more people may use cards less (especially with smaller transactions), which could make it so that merchants are more comfortable with discouraging use through surcharges/minimums, thus creating a feedback loop that'd be difficult to break.
Do nothing: a significant minority of merchants would likely stick with magstripe and never bother with EMV. Plus the reduction in card use as with #2 .

Of course, there could be other options I missed, too.

Points Scrounger

It may take a while, but the issuer-processors are going to end up telling merchants that they're only going to process via EMV. Which brings up to giant roadblock: restaurants.

My prediction is that (higher-end) ones with a more leisurely experience, and chains, will use Pay at Table units. Diners, and others that feel bringing the unit to a table slows things down, or too expensive and complicated, will go pay-at-register. Some will go Cash Tip Only, if the servers continue taking cards away with no tip adjust, similar to Australian tap-and-return practice.

In my experience, most newer businesses started out with EMV, so some sort of future "mandate" will have them feeling that the units are due for upgrade/replacement anyway. The mysterious exception locally is the drugstore chain Bartells, which has had NFC for years, but shows no sign of adding EMV at all.

tmiw

If the liability shift were to be "suspended", that timer likely wouldn't start until after the liability shift became a thing again. However, it may end up not taking as long as it would have, especially if the liability shift is only brought back when the vast majority of merchants are enabled and meet minimum standards in e.g. transaction times.

(On the other hand, close to 60% are supposedly enabled now without having to resort to that, but are probably not as fast as they could be.)

Clover just came out with a new Clover Station with an EMV slot facing the cashier. Contactless is still optional with that and likely won't be adopted by most restaurants. Not to mention that as long as PIN support's disabled at the terminal level, tip adjust is 100% reliable.

I guess what I'm trying to say is that it's basically working out as I predicted way back when it became obvious that the US was doing chip and signature: restaurants mostly aren't doing pay at the table--or pay at the front either, for that matter. There are exceptions, of course, and it's still possible that the latter might become more common over time if contactless becomes more commonly used. I also wouldn't be surprised if restaurants never bother changing how they do things and just partner with someone like OpenTable to gain mobile payment support via apps/websites, especially if contactless cards never become common.

What would they gain by replacing them before they absolutely had to, though? A lot of the initial rollout involved hardware that already had contactless built-in.

However, would they replace their broken/unusable stuff with non-contactless capable equipment if it was somehow less expensive? I'm not sure on that.

tmiw

So it turns out AmEx does have issues at work's vending machines after all, but only with contactless cards; Apple Pay works fine. Weirdly there's no error on the display, just...nothing other than the four lights turning on. I don't expect this to be fixed any time soon, unfortunately.

D582

So what I would have done if I were in charge of this whole migration at one of the card networks is use it as an opportunity to simplify and improve US payments infrastructure:

• Start early with setting software quality standards and minimum requirements for payment software, the goal being to incentivise pre-built and certified semi-integrated solutions over fully integrated
• Work with the major terminal manufacturers to standardise payment application UI and flow, and transaction throughput times so the cardholder experience is consistent. As well, developing terminal software that would allow merchants to utilise the terminal for non-payment events like line-item displays, loyalty etc. whilst still isolating the payment app and payment processing. Only when these solutions were ready for market should the transition have started.
• Move the liability shift 2-3 years later. The US environment was simply too complex for it to happen when it did.
• Require merchant terminals to accept both EMV contact and EMV contactless in order to benefit from the liability shift
• Incentivise merchants with lower interchange rates on EMV contact and contactless transaction with requirements that processors directly pass on the savings to the merchant. Further incentivise contactless acceptance especially for lower value transactions with an additional interchange discount (say for the first $50-100). These may be phased out slightly over time well after the US is EMV mature.
• Incentivise issuers to issue dual-interface cards early and set a date when all cards must be dual-interface
• Set a date to sunset 'tip adjust' giving enough time for restaurants to decide when to update their payment process to pay at front or pay at table.

But then you know, nobody asked me

D582

I was in the South Bay Area today and stopped by the Costco in Sunnyvale that theoretically takes contactless payments. I say theoretically because despite all the terminals saying Tap Card and displaying a (poorly rendered and squished) contactless logo, I had to try 4 different tills to get one that actually had NFC enabled. The others just did not respond to anything. The manager there was very happy to try different tills in order to better report which ones were working. They said that it has never been reliable and will randomly stop working.

As much as I would like Costco to roll out contactless across the US, I don't think they should until they get it actually working reliably.

(For those wondering, I tapped when everything was totalled, and the amount used for the cryptogram was US$1.00)

tmiw

Speaking of Costco, some are apparently listed on the MC map:


I didn't think they'd be on there due to only accepting Visa and debit.

tmiw

It's almost as though it was rushed due to some external factor. 🤔

I'm also still not convinced most US banks are truly interested in any form of contactless payment. We'll see though; at least some issuers are starting to offer rewards for using it now.

emmanuel_t

Maybe the problem has to do with their IBM/Toshiba system (which doesn't work reliably with contactless at places like Safeway).