When Visa first announced Quick Chip, an enhancement to EMV chip card processing that speeds up checkout times and simplifies implementation, many were asking when, where and how the solution would be available. The answer lay in the many payment processing and software service providers that help retailers receive electronic payments. Several months later, we announced the first Quick Chip terminal at New Leaf Community Markets in Santa Cruz, California, made possible by our friends at Index. Index’s EMV solution with Quick Chip was the first live implementation of Quick Chip in the U.S.
We sat down with the Index team—Marc Freed-Finnegan, co-founder and CEO, and Joseph Koenig, partner technology manager—to hear more about the Quick Chip rollout.
How has Index been working with U.S. merchants to evolve in-store payments?
MFF: At our core, we provide a set of payment and security solutions to help brick and mortar retailers evolve and modernize their stores. We’ve been excited to work with retailers across the country—from grocery stores and Quick Service Restaurants to apparel brands—to provide technology that helps them manage and grow their business, while making the payment experience smooth, secure and convenient for customers.
What should merchants be thinking about as they consider updating to chip?
MFF: Line speed is always critical. Long lines mean lost sales—and that creates trepidation about moving to EMV. The good news is that Visa pioneered Quick Chip and with it, Index has delivered the first implementation in the US. Store owners gain all the security benefits and liability protections of EMV and their lines are as fast as ever. By some reports, the average time a card is in the reader is 13 seconds—we’ve reduced this to 2.5 seconds. Even better, we’ve eliminated the impact of EMV on checkout and lines are already 13% faster. We’re excited to help all of our retail partners move to Quick Chip to get these same operational and customer benefits.
How does Quick Chip make checkout so much faster?
JK: The Quick Chip specification optimized some of the processing that happens in the terminal, which helps us bring down the amount of time that the card must be in the reader. But the biggest impact is the “pre-dip” capability that Quick Chip enables.
What’s the pre-dip?
JK: To understand pre-dip, it’s important to understand its predecessor – pre-swipe. For decades, shoppers have been able to swipe their card anytime during checkout and put their card back in their wallet—even before total. Consumers want to get in and out quickly, and we’ve seen 40 percent of customers pre-swipe at checkout.
One of the primary challenges with traditional EMV is that unlike the pre-swipe experience, customers must leave their card in the reader until all items have been scanned, the cashier has hit total, and their card has been authorized.
What’s exciting is that Quick Chip supports a pre-dip experience that’s very similar to pre-swipe. Customers can dip, immediately remove their card and put it back in their wallet, all before total. It’s a huge time saver, particularly at grocery stores, where having the customer’s hands and eyes free—to bag and cart groceries, sign receipts or attend to a child—can shave critical moments off transaction times. This pre-dip functionality is already delivering meaningful time savings for our merchants because the full card interaction can be completed while the cashier is still adding items. We’re already seeing 36 percent of customers pre-dip where we’ve deployed Quick Chip.
Why did Index choose to move ahead with Quick Chip?
JK: It was really a no-brainer—Quick Chip has all the security benefits of traditional EMV but offers simplified certification, faster checkout, and a better customer experience.
How does Index bring secure EMV payments to U.S. merchants?
JK: Testing and certification have been a barrier for many retailers to successfully deploy EMV. Index’s solution architecture actually enables us to eliminate all retailer EMV certification testing.
How? We use a semi-integrated payment architecture, which routes payment data directly from the payment terminal to the processor. Because of this architecture, our retail partners don’t need to go through any of their own EMV certifications—each semi-integrated payment terminal is already fully certified for EMV. Our architecture also made it possible to deploy Quick Chip to our retail partners overnight with a remote software update.
We’re now entering Year Two of the U.S. migration to chip technology. Any predictions on what we can expect to see for merchants?
JK: For one, the cost to merchants who do not accept chip cards will grow. Some retailers delayed EMV acceptance because they perceived the cost associated with the liability shift to be low, but as more retailers are chip-enabled, fraudsters will have fewer and fewer targets. Essentially, the funnel of fraud opportunities will narrow and the cost of non-implementation will grow.
MFF: We also expect to see a large focus on line speed. Transaction times are critical and there will be continued pressure to optimize in-store operations so that EMV doesn’t slow down lines. Quick Chip creates a blueprint for an optimized experience, but how it’s implemented will be just as important.