Although it may feel as though the postponement of the EMV liability shift to April 2021 just recently occurred, several months have actually elapsed since the delay was announced earlier this year. In fact, when October arrives, the fuel industry will again only be about six months away from the liability shift, which is extremely unlikely to be delayed again.
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While an element of uncertainty has pervaded 2020, the liability shift in 2021 is beset by inevitabilities that fuel site operators need to prepare for. Here are 3 of them.
1. There is still likely much work to be done.
According to a Conexxus survey conducted in the early part of 2020, only 15% of fuel marketers, distributors/wholesalers and major oil companies have completed contact EMV (in which a card is inserted into a card reader) at their fuel dispensers. According to the survey, 10% of respondents – all of whom had 10 stores or less – were undecided about implementing contact EMV upgrades, with the cost of upgrading as the top reason for not yet pursuing upgrades. While more sites may have completed EMV upgrades in the months that followed the survey, fuel marketers should still prepare for a constrained supply chain and a limited availability of technicians to complete future upgrades.
2. Fraud liabilities will eat into profitability.
Despite the low percentage of fuel sites that have completed EMV deployment, the Conexxus survey indicated that 0% of respondents thought the risk of assumed liabilities did not justify the expenses associated with EMV upgrades. And more and more research shows that fuel sites that do not complete EMV upgrades will jeopardize their profit margins. According to a recent analysis from Mercator Advisory Group and Transaction Network Services, fuel marketers who do not complete their EMV upgrades in time for the liability shift could be met with costs greater than $200,000 over the course of 12 months. The estimate was based on a fueling operation with 12 sites. In another estimate, Conexxus cited that losses resulting from card fraud ranged from $5,072 to $101,179 over a 12-month period.
3. A constrained window of time to complete upgrades will result in higher expenses.
Timely initiation of EMV conversion is a key to preventing upgrade costs from escalating. From site survey to payment host enablement, completing EMV upgrades can take an average of 4 to 6 months. In most cases EMV deployment at the fuel island requires 2 separate visits from a technician. For stations in northern regions of the country and that are making upgrades that require breaking concrete, the “actionable” amount of time to complete upgrades from October to March may be even be less given the limitations that wintry weather creates. Fuel sites that have not begun the deployment process should reach out to a trusted equipment supplier or technician immediately to conduct a site survey to determine hardware and software needs.
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