EMV for Small Merchants Is a Hard Sell, But It’s Easier With The Right Approach

Selling payments services to small merchants is never easy. Now, throw in EMV and its attendant complications, add in merchant ignorance of the technology, and the sales pitch gets more complex.

With the impending liability shift set for Oct. 1, independent sales organizations, acquirers, processors, and banks are scrambling to get merchants on board with EMV. The chip card technology should put a dent in point-of-sale fraud, but it can’t do that if consumers can’t use their cards at their favorite merchants.

Small merchants, in particular, are poised to be least ready come October. Getting them to listen to the EMV sales pitch might be tough, but there are ways to make it a little more appealing, as outlined in “10 Ways To Sell Small Merchants on EMV,” a recent Digital Transactions webinar.

One tip is to explain how security-conscious consumers might balk at using magnetic-stripe cards instead of their chip cards. Issuers will be touting the security benefits of chip cards, and while consumers may not understand EMV, they’ll have seen the publicity about data breaches and will want to use it.

Another tip is to bundle EMV with tokenization and encryption services, which is especially useful for merchants that sell online. Using these technologies can do a better job of protecting sensitive card data.

Sales agents can bundle EMV with other services, too, says Rick Oglesby senior analyst at Double Diamond Group, a Centennial, Colo.-based payments advisory firm. Use POS systems, with business-management features, to lead the sales pitch, he suggests.

With all of the hoopla over mobile payments, especially widespread awareness of Apple Pay, merchants might be more receptive to talking about near-field communication (NFC) equipment that also happens to be EMV-compliant.

Merchants using POS systems also might be more receptive to buying EMV equipment if the independent software vendor or value-added reseller they use recommends it, in conjunction with the payments company.

Another course is to quantify a merchant’s liability should they have a fraudulent transaction. That could include the cost of lost goods and fees from the card networks.

The specter of criminals, too, can be put to work in the sales pitch. They will seek the easiest way to commit their crimes, and make money. Because most larger merchants will have EMV equipment, criminals will seek out those without it. Small merchants will become the next easiest target, says Tom Fluegel, associate director of business development and product management at TSYS Acquiring Solutions, a unit of Columbus, Ga.-based Total System Services Inc. (TSYS).

Other tips include:

• targeting higher-risk merchants, such as jewelers;
• subsidizing the equipment to gain processing contracts with merchants;
• using incentives to ease merchant costs.

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Look for a more detailed story on how to sell EMV to small merchants in the upcoming June issue of Digital Transactions magazine.