Visa, Mastercard delay upgrade of gasoline pumps
Merchants now have until late 2020 to install chip-card readers
Visa Inc. and Mastercard Inc. moved back the deadline for installing chip-card readers in gasoline pumps after station owners complained they didn’t have enough time to complete the multibillion-dollar upgrades.
The world’s largest payments networks will give merchants until October 2020 to adopt the technology, three years later than previously planned, the companies said Thursday in separate statements.
Visa said it will monitor payment trends at the pump to help gas-station operators and card-issuing banks prevent fraud during the interim period.
“In some cases, older pumps may need to be replaced before adding chip readers, requiring specialized vendors and breaking into concrete,” San Francisco-based Visa said in a statement on its website. Sufficient supplies of compliant hardware and software to enable upgrades by 2017 remain an issue, the company said.
Station operators will spend almost $30,000 per store to replace the payment systems at pumps, bringing the total cost for the industry to about $4 billion, data compiled by the National Association of Convenience Stores show.
Card fraud costs the industry $250 million a year, according to Conexxus, a company that provides technology standards for convenience stores and gas stations.
Visa and Mastercard have been pushing for a migration to chip readers to head off counterfeit cards. The technology — named EMV for founders Europay, Mastercard and Visa — generates new codes for each transaction, while the codes on magnetic stripes are permanent and can be copied and stored by hackers for later use.
Banks are currently responsible for covering any fraud that happens on consumers’ cards at gas pumps. After Visa’s deadline, the liability for covering that fraud shifts to gas station operators for those that haven’t upgraded their terminals in time.
The decision to delay the deadline is the second time in a month that Visa has announced moves to appease merchants after years of tense relations between the two groups fueled by arguments over fees. Last week, the company said it would revise its rules for using the new chip technology for debit-card transactions after some retailers claimed the requirements inhibited competition.