It turns out many U.S. gas stations are seriously behind the times. Fuel pump owners around the country find themselves scrambling to install new payment technology, ahead of an October deadline. Those who don’t face the possibility of very expensive consequences.
The problem is that many gas stations across the country still rely on simply swiping in order pay by credit card. However, major credit card companies like Visa and Mastercard have long since upgraded to more secure chip cards. They typically require customers to input a PIN in lieu of a signature. Chip cards have drastically reduced simple credit card fraud that stems from forged signatures.
Visa and Mastercard have rejected a request to delay an upcoming October deadline to convert old gas pumps. Any gas station who doesn’t support chip cards after the deadline could be on the hook for any fraud that happens at their business.
“There’s not enough technicians to do the installments,” said Joshua Smith, CEO of Gas Pos — a company that sells point-of-sale systems for gas pumps. “There’s not enough inventory. Even if there were enough contractors, there’s not enough dispensers available.”
Time is Up
If you think that Visa and Mastercraft are being unfair in their deadline, think again. Most retailers began upgrading in 2015, which is when the first deadlines were. Fuel retailers successfully lobbied to have their deadline pushed back five years. Now their time is up, and many have procrastinated.
“In a 2019 survey by Conexxus, a non-profit that represents convenience stores, almost 70% of respondents who own a convenience store said they haven’t upgraded any outside pumps to the new so-called EMV technology.
“Few companies manufacture the required pumps. Those that do – such as Dover Corp. or Fortive Corp.’s Gilbarco Veeder-Root – have said they’re expecting an increase in sales ahead of the deadline. Once the hardware is installed, fuel companies must have the pump software certified.
“Fuel retailers that don’t upgrade could face costs of as much as $201,000 per store over the next seven years, according to data compiled by Conexxus. The group expects the fuel industry to suffer $451 million of card fraud in 2020 alone.”
For their part, the credit card companies are sticking with their deadline in the name of increased security.
“We believe extending chip technology to fuel pumps is an important step to take to protect businesses and consumers who want to pay securely as well as conveniently,” Visa said in a statement.