WASHINGTON–The National Retail Federation has issued a statement that if consumers don’t have a chip card in their wallet, it’s not merchants’ fault.
"Banks have failed to meet their own deadline for converting to chip cards, but America’s retailers are open for business either way,” said, Mallory Duncan, senior VP and general counsel for the National Retail Federation.
The NRF pointed to a CreditCard.com survey in September that found just 40% of cardholders had received a chip card.
“Furthermore, credit card companies have been unable to grant the necessary software and payment terminals certifications to stores nearly fast enough to meet their own deadlines,” the NRF said in a release outlining “facts” around the Oct. 1 EMV liability shift deadline. “Consequently many retailers have chip-reading terminals set up in their stores, but they can’t turn them on until they’ve been certified by the credit card companies. Until then, customers will have to continue swiping their cards”
That statement runs somewhat counter to other research that has found many retailers, especially small mom-and-pop shops, have yet to upgrade to EMV-compliant terminals.
Nevertheless, the National Retail Federation also said that many retailers are “going beyond the chip card mandate and voluntarily implementing data encryption and tokenization to safeguard the payment authorization process.”
With many retailers in the cross-hairs of lawsuits and public criticism over breaches, the Federation also stated, “the transition to chip and signature cards is still only a half measure—cards without PINs are not the safest possible measure. It’s like locking the front door and leaving the back door unlocked. Most banks refuse to include PINS on credit cards, but the majority of U.S. consumers prefer to use chip-and-PIN cards rather than chip-and-signature cards. NRF and the retail industry have called for chip-and-PIN cards – which are widely used in Europe – but the card industry is issuing cards in the U.S. that only require a fraud-prone signature as proof of identify.”