Square Working to Speed Up EMV Chip Card Payments
There’s a big problem that has come to light as America adopts EMV cards: they’re painfully slow. Because of the complexity involved with chip card payments, including generating a unique card number for each individual transaction, the entire process is noticeably and frustratingly longer than the old magnetic stripes did. Now one FinTech company is working to speed up EMV payments to the delight of both customers and entrepreneurs.
Square has just released an update for their chip readers that makes them up to 25% faster than before. According to the company the average transaction prior to the update was 5.7 seconds. With the update they have reduced it to only 4.2 seconds. Although that might not sound like a big difference it’s still an encouraging step in the right direction. As Jesse Dorogusker of Square told VentureBeat, “Consumers and business owners alike loathe waiting for chip cards to process. And we, at Square, feel the same.” As a result this time-saving firmware update will install on the company’s device automatically with no need for business owners to do anything.
What’s also interesting is that Square’s transaction times were already way ahead of the national average. According to a test by The Wall Street Journal, most chip card payments take up to 13 seconds to process. Additionally anecdotal evidence suggests that there remains confusion over which retailers are using over chip readers, further slowing transaction times.
Some have speculated that the added transaction time has actually helped push the adoption of mobile and contactless payments. Wisely Square choose to combine the two technologies with the release of their new readers last year. Since launching in November of 2015 the company says they’ve received orders for more than 500,000 of the readers, which can be used alongside their classic magnetic strip readers. The contactless/chip readers cost retailers $49 upfront or $1 a week for 60 weeks through their leasing program, which they announced this past May.
Ironically the push by Square to not only offer EMV and contactless payment technology but to also improve it puts smaller businesses in a more advanced position than some their larger competitors. According to a study done in February of this year less than 40% of retailers offered working chip card readers. While those figures may have risen in the months since, it’s notably been almost a year since the liability shift, which was seen as a big deadline for retailers to install the new technology.
Overall chip card payments are struggling and causing more than a few headaches. But, where’s there’s a problem, you can bet they’ll be someone there to make money off of a solution. In this case Square is once again proving their competence in the payments field and showing why they and other FinTech companies have been growing in popularity.