The Effects of the EMV Liability Switch on the Food Service Industry

The EMV liability switch has caused concerns for foodservice professionals and operators on several different levels. Last week, we talked about how chip readers (and the inherent delays they can cause) affect overall customer satisfaction. This week, decided to focus more on some of the operational issues that have surfaced over the last six months.

Interactive kiosks are not new to the foodservice industry, but right now, they appear to be having their moment in the sun, so to speak. With restaurants like McDonald’s, Applebee’s, Taco Bell and Panera all rolling out some version of a self-service kiosk over the last couple of years, all eyes are on them as the industry wonders if they’ll be a big hit, complete miss or fall somewhere in between.

One very positive aspect of utilizing self-service kiosks in food service environments is the lower cost of implementing the new chip-based (non-PIN) EMV systems in these types of environments. Because -- for better or for worse, depending on who you ask -- U.S.-based companies are not required to integrate PIN-entry devices (PEDs) into their EMV chip readers, it makes it much less expensive to deploy them.

In truth, putting chip and pin-based EMV readers into fast food and quick service restaurants is a little like gilding the lily for the most part, anyway. These aren’t high-dollar transactions. The average order at most quick service restaurants like Burger King or Arby’s is only around $5 -- not exactly the most-attractive target for those hoping to commit credit card fraud. These lower-dollar transactions add up to a smaller necessary investment when it comes to the type of EMV reader required.

We spoke with Rob Chilcoat, president of North American operations for Unattended Card Payments, Inc. (UCP), and an expert in EMV technology, to learn more. “If the client doesn’t have an expectation of accepting PIN debit, SNAP, or EBT,” he said, “then you can use a much less costly device such as the OTI Trio which doesn’t have all the security bells and whistles that come along with an unattended PED.” Based on current pricing, this can amount to a savings of as much as $1000 per reader, compared to the other more high-profile brands.

“Really, using a PED is more relevant in high-tech vending situations, selling iPads, for example, where you want to take that extra step to verify a customer’s identity using a CVM (cardholder verification method),” he added. “An unattended kiosk where a thief can use a stolen credit card to purchase high-value goods that can be fenced for cash are most at risk, because no CVM means anyone can use a stolen credit card there.”

While the EMV liability switch has certainly caused its fair share of headaches to QSR outlets, at least the additional pain of high-priced chip-and-pin readers has been kept at bay. For now, anyway.

RedyRef, a provider of vertically integrated kiosk solutions, is helping food service companies of all sizes navigate the complexities of the liability shift. Looking for assistance? Submit a request for proposal online or call (800) 628-3603 today for more information.

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