Researchers from Retail Logic, a provider of payment processing software, visited 10 towns chosen at random to see if the new payment technology was in use following the January 1st liability shift. Banks will no longer cover the cost of a fraud committed using a Chip & PIN card if it could have been prevented by the shop using a chip and PIN card payment terminal.
While the financial community has successfully raised the profile of card fraud and most consumers have at least one Chip & PIN card, locations where the new technology is in use remain in the minority.
Farnham topped the readiness list with almost two thirds of retailers being protected, but of the 159 retailers checked in Guildford, only 68 had Chip & PIN equipment. In Oxford, a meagre 15 stores visited were found to be operational.
"What was disappointing was the number of familiar high street names that are clearly still some months away from completing their rollouts," said Retail Logic Marketing Director Mark McMurtrie. "If you've got a stolen credit card, Oxford looks like the best place to go shopping."
The stores visited in each town ranged from small retailers to the largest national chains, operating across a wide range of sectors. These included high-risk areas such as jewellery and electrical goods as well as lower-risk groups like booksellers and furniture shops. While overall small retailers appear to be well-catered for with bank-owned terminals, the mid tier remains exposed, along with some larger operations with incomplete installations across their estate.
Retail Logic found that high risk sectors such as jewellers have clearly heeded the warnings and upgraded, but a significant number of small retailers said that their bank-owned installations were either not yet connected or were posing operational difficulties including unacceptably-slow transaction times. Another area found to be at considerable risk was the hospitality area, where integrated PoS (Point of Sale) wireless technology is only just coming on stream due in part to delays in finalising procedures for handling transaction types such as bar tabs.
"It is clear from the survey that mid tier retailers have held back due in part to a lack of integrated systems suitable for them," said McMurtrie. "But perhaps the most disturbing survey finding was that the financial services sector has yet to implement Chip & PIN on its own high street counters. After years of banks and building societies extolling the virtues of Chip & PIN to retailers and their customers, it's time for them to put their money where their mouth is."
One mid tier retailer yet to implement Chip & PIN commented: "What's the point of me spending good money to prevent crooks buying goods in my store with stolen cards when they can simply walk into a high street bank and withdraw cash over the counter by forging a signature?"