With an Update, Square Shaves More Seconds From Contact EMV Processing Time

Merchant acquirer Square Inc. has again improved the speed of EMV transactions made with its contact chip card reader, lowering the speed from 4.2 seconds, as reported in November, to 3.6 seconds, as noted by Jack Dorsey, Square chief executive and chairman, in a Twitter post on Friday.

Earlier in 2016, Square cut 1.5 seconds from its previous low of 5.7 seconds to reach the 4.2-second transaction time. The improvement in the speed of the transaction—accomplished via an automatic firmware update to the reader—attempts to address one of the complaints consumers and merchants alike have about contact EMV transactions, which is that they are far too slow compared to familiar card swipes.

Dorsey, in his tweet, said the industry average for a contact EMV transaction is 11 seconds. Last October, UL, the Northbrook, Ill.-based testing lab, said the fastest EMV transaction time it has measured is 4.4 seconds. Merchant acquirer Cayan also noted in May that EMV transactions made on its Genius point-of-sale platform averaged less than 4 seconds.

Square uniquely can address the transaction time issue, the company said in a statement. “First, we build our own hardware, so we use custom-designed components to maximize efficiency and better performance,” Square said. It also writes the software for use in the readers and its apps, ensuring a seamless integration, it said. This enables it to prioritize for speed and ease of use.

But, it’s not just acquirers with their own technology trying to address EMV transaction times. All four of the card brands—Visa Inc., Mastercard Inc., American Express Co., and Discover Financial Services—have introduced technology to speed up processing times. With monikers like Quick Chip and M/Chip Fast, the tech tweaks the EMV protocol by removing some interactions with the chip that not needed in the U.S. payments system.

A major difference from the standard EMV transaction is that the chip card can be removed from the terminal once the one-time cryptogram is generated. Consumers are alerted by a prompt on the point-of-sale terminal display.

Introduced in 2015, Square’s EMV reader also accepts contactless payment, which has been touted as having a speed advantage over EMV contact transactions. The widespread adoption of contactless payment, whether made with a payment service on a smart phone or a contactless EMV card, has yet to happen, however.