EMV UPDATE PART 2: How Restaurants & Hotels Continue to Address the EMV Challenge
EMV will gain greater momentum in the restaurant and hotel arenas as the truth behind these misperceptions and myths emerges, sources say. In part one of this story, "How EMV is Faring Two Years Post Liability Shift," HT identified some of the obstacles and roadblocks that have punctuated the path to EMV.
Now, experts foresee heightened recognition of EMV’s potential to offer nearly airtight data security when combined with tokenization and point-to-point encryption (P2PE) technologies. Tokenization technology protects card data by replacing the primary account number (PAN) with a token (a unique, randomly generated sequence of numbers and alphanumeric characters) or a combination of a partial PAN and a random alphanumeric sequence. P2PE encryption technology encrypts card data at the point of capture, before it passes through the secure payment gateway to the bank or processor. Data encrypted via P2PE technology remains encrypted until it reaches its destination.
Choice Hotels International Inc. (www.choicehotels.com), which has more than 6,500 franchised properties in more than 40 countries and territories, began its U.S. EMV rollout in 2016 and will continue with the initiative through mid-2018. As of September 2017, it had deployed EMV-compliant iSC480 POS terminals from Ingenico (www.ingenico.com) for processing chip cards at more than 3,000 of its domestic franchised locations. When the implementation project is complete, the devices will have been deployed at over 5,300 domestic franchised properties.
“In the marketplace, there continues to be confusion about EMV,” notes Jason Stead, Choice Hotels’ vice president, enterprise security. “EMV, by itself, does not provide sufficient security. However, when it’s coupled with tokenization and P2PE, it’s a better solution.”
Stead believes EMV has been “a better solution” for Choice Hotels not only because liability for any card-present fraud that does occur is “shifted back to the card issuers,” but because of the protection afforded by tokenization and to cardholder data in transit by the P2PE. The operator has had few difficulties at properties where the EMV-compliant terminals have been installed because it acknowledged the need for tokenization and P2PE prior to implementation and made them part of a multifaceted EMV enablement strategy Stead says is a must for every operator. The Ingenico devices leverage TrueTokenization ® and True P2PE technology developed by Shift4 (www.shift4.com).
The growth of contactless mobile payment technology will play a part here as well, as will a push by restaurants to implement pay-at-the-table solutions. Such players as Vantiv (www.vantiv.com) and Cardtek anticipate that the push toward contactless mobile payment applications will lead to an “EMV 2.0” scenario in which POS solutions providers update or make initial adjustments to their EMV certifications to support the EMV contactless standard. EMV and the increased sense of security it imparts will, these sources contend, give operators a reason to embrace mobile and contactless payments at scale.
The same is true of pay-at-the-table technology, as restaurant operators budget for upgrades within their normal POS refresh cycles and turn to vendors or resellers to address the complexity of the in-store networking needed for Wi-Fi or Bluetooth-enabled EMV readers to facilitate pay-at-the-table capabilities. The need for restaurants to accept chip cards in response to heightened demand from customers who increasingly expect to handle their checks without surrendering their cards to a server and putting their card data at risk will play a role here as well, according to Vanderhoof.
Customer demand was the rationale behind the implementation of an EMV-enabled, integrated pay-at-the-table configuration at more than 50 North American locations of The Keg Steakhouse + Bar (www.kegsteakhouse.com), reports Rob Varley, vice president, IT. Rolled out earlier this year, the configuration’s components encompass Verifone (www.verifone.com) VX 690 mobile terminals, supported by a P2PE managed payment solution from Eigen Development Ltd. (www.eigenpayments.com). The Keg has seen “reduced chargebacks” and improved its caliber of customer experience with the mobile EMV-compliant technology in place, Varley noted.
Further technology-related developments should also fuel the EMV fire on the restaurant and hotel sides alike. The enhancement of property management systems (PMS) to support EMV transactions—the initial step taken by Choice Hotels with its SkyTouchTechnology (www.skytouchtechnology.com) cloud-based PMS in its march toward EMV compliance—comprises one example.
Acquirers, payment providers, and processors are pursuing technology-centered strategies in a move to simplify the prospect of a move to EMV by hospitality players of all types. For example, Vantiv is working with card brands to design streamlined certification processes and new test plans to facilitate equipment certification for Mastercard’s Quick Chip and other chip technology intended to speed up EMV transactions.
In a somewhat different vein, Shift4 and SkyTouch have devised an EMV-certified solution that allows chip card payments to be processed in the cloud using Shift4’s DOLLARS ON THE NET POS solution and SkyTouch’s cloud-based PMS. Similarly, payment provider BluePay (www.bluepay.com) and Datacap Systems (www.datacapsystems.com) have launched TranCloud ™ an EMV-enabled payment application for mobile and browser-based POS systems. The cloud-based payments hub connects to merchants’ payment networks to facilitate the transaction process, allowing merchants to process transactions through the BluePay payment gateway. BluePay’s EMV certification for TranCloud™ currently supports compatibility with Ingenico’s line of Telium 2 payment terminals.