More than 20% of medium-sized UK retailers have decided
to delay implementation of chip and Pin-compliant systems until
their next point of sale upgrade, according to research
released this week.
The findings, from a survey of 179 retailers by software firm
Retail Logic, means that it could be more than five years until all
UK retailers can accept Pin authentication, despite the fact they
will be liable for fraudulent transactions from 1 January 2005.
Out of the "tier-two" retailers questioned, which covered
businesses with between 10 and 250 employees, 56% said the
complexity of the accreditation process and a lack of clear
guidance from banks were the major obstacles.
Of the respondents, 52% estimated that the cost of migration
would be between £100,000 and £500,000, and that 18% were planning
to spend less than £100,000 and 10% more than £1m, the survey
showed.
Despite fears over complexity and cost, more than half of the
respondents said they would be ready before the January deadline,
26% expected to go live no more than six months later and 79% hoped
to be ready within the next 12 months.
However, these targets may prove to be over ambitious for many
retailers, said Peter Mila, IT director at fashion retailer Kookai,
which is just about to go live with chip and Pin across its 27 UK
stores.
"The accreditation process is very time-consuming with
conflicting interpretations of standards and limited testing
resources," he said.
"Many retailers are neglecting the fact that existing network
infrastructures will need to be upgraded to achieve chip and Pin
compliance. Those retailers that are not already well advanced in
their preparations will now struggle to meet the January 2005
deadline."
Kookai is rolling out point -of-sale hardware from Anker, with
Retail Logic’s Smart-Switch software embedded, after receiving
Acquirer Acceptance Testing from HSBC.