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.
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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.