MasterCard Asia/Pacific Survey Reveals Merchants are Gearing Up for Migration to EMV Compliant Smart

Monday 24 November 2003 16:22 CET | News

MasterCard International Asia/Pacific Merchant Smart Card Study, found that approximately half the merchants surveyed are aware of the salientattributes of smart card technology and have initiated activities in preparation for the EMV compliance deadline of January 2006.

MasterCards objectives for the study were to determine merchants views on current payment modes, ascertain needs and expectations, explore merchant attitudes towards conversion to smart card technology, identify additional avenues to support the acceptance of smart card payments and establish merchant awareness levels of EMV compliance requirements. The study was conducted in eight countries in the Asia/Pacific region: Australia, Hong Kong, Japan, Korea, Malaysia, New Zealand, Singapore and Taiwan. A total of 244 senior executives from various retail sectors participated in the survey. Thirty of the respondents were selected for in-depth interviews. The survey revealed that credit cards and cash are the most popular payment modes in all eight countries surveyed. Of the merchants surveyed, 77% accept credit card payment, in addition to cash. About half of the merchants surveyed were able to articulate the benefits of smart card technology, with merchants in Japan, Malaysia and Taiwan leading in awareness. The lowest awareness levels were recorded in Singapore and Hong Kong. The survey also indicated that merchants recognize the advantages of using smart card technology over traditional magnetic strip cards. Merchants singled out fraud reduction as the most important benefit of smart cards. They recognized that smart cards directly address the way most fraud is perpetrated. Other salient benefits identified include more efficient transaction processes, wider range of functions and applications of smart cards, enhanced loyalty programs, cost savings, and decreasing the number of point-of-sales terminals. The study also showed that perceived barriers to the adoption of smart card technology is the high investment cost of switching, as well as cost for staff training and the technical expertise required to operate point-of-sales terminals. The survey revealed that over half of the respondents either have taken or intend to take steps towards EMV compliance, with merchants from Australia, Japan and Taiwan leading the region in the move to adoption. In preparation for EMV migration, merchants have a three-prong action plan that includes planning and budgeting, liaising with banks and providing staff with training. They have also requested that banks and payment solutions companies provide more information on smart card technology and EMV compliance, and regular updates on the progress of migration.

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Categories: Payments & Commerce | Cards
Countries: World
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