By Lori Griboski
Petroleum Card Services, Paysafe
Editor's Note: A version of this article appeared previously in the Oct. 1 issue of "Digital Transactions." Copyright (c) by Paysafe Group. Published here with permission.
The implementation of new rules shifting the liability for non-EMV enabled card payments to gas stations is already having a significant impact on the industry. It has only been a few months since petroleum merchants began taking financial responsibility for fraud that occurs at the pump using cards where the payment terminal doesn't require chip and pin EMV verification.
Yet many of the long-term consequences, particularly for those that are yet to install new payment terminals, are becoming clear. One of these consequences is that the rate of gas stations de-branding is increasing.
And this can be a confusing and often worrying time for gas station owners. No longer being associated with a major brand can have serious financial implications, but it can also mean having to think about many aspects of running a gas station operation for the first time.
When operating under a partnership with a brand, much of the nuts and bolts of running a business is overseen by the brand, so it is understandable that newly independent gas stations have a lot of questions and are looking for answers. The good news is that gas stations that find themselves in this situation have options, and there are specialists in the petroleum industry that they can turn to.
Typically, gas stations have long-term contracts in place with major petroleum brands, and there are often good reasons for doing so. These include increased consumer recognition and trust and sometimes more economical access to fuel.
However, the introduction of the EMV liability shift left both parties considering their options when a gas station is yet to convert its at-pump payments authorization to chip-and-pin. Many brands simply do not want to be liable for at-pump fraud, and this discomfort is only going to grow with fraudsters increasingly targeting these vendors.
The result is that many brands are strongly considering terminating the contracts of gas station owners that haven't installed chip and pin terminals for being in breach of its terms and conditions.
And where they haven't ended their relationships with gas stations that are yet to implement EMV-enabled at-pump payments altogether, it is becoming increasingly common for brands to charge a monthly non-compliance fee. In many cases this fee is increasing every month. With the cost of non-compliance escalating, but the industry remaining backlogged by a lack of technicians and months of hardware orders that haven't been fulfilled, gas stations' only choice is to pay the fees or consider an alternative future separate from the brand.
Gas stations that are de-branding may be thinking about how they accept payments for the first time, as brands often manage the partnerships with payment providers directly. This, coupled with the ongoing dilemma of navigating the at-pump EMV requirements, means that partnering with the right payments provider is going to be key to running a successful business once the de-branding has been completed.
Payments companies that specialize in the petroleum industry can provide support and advice to gas station owners to navigate through a complex landscape. And there are other questions gas stations will need to answer once they have de-branded, most notably (but not limited to) where they will now buy their gas in the future. But again, payments providers with deep experience in the sector can also offer support through their extensive partnerships throughout the industry.
There are payment companies that are experts in merchant services for gas stations that can take a significant amount of stress from the shoulders of owners. They have ongoing partnerships with other services such as technicians that should reduce much of the worry associated with de-branding.
Although the reason gas stations may be considering de-branding is to avoid the heavy fees brands are charging for not being EMV compliant, this shouldn't be viewed as an alternative solution to the issue of at-pump fraud liability.
As I've already mentioned, fraudsters are increasingly targeting gas stations without EMV-enabled payment terminals at their pumps. So even where gas stations haven't seen a recent spike in fraud costs after the liability shift to-date, it is an inevitability that this will happen.
And while it is true that there remain delays in the supply chain for gas stations that are trying to replace their existing terminals so they can become EMV compliant, that isn't a reason to not take immediate action. Payments specialists within the petroleum industry can provide options to gas stations that are looking for temporary or less costly solutions than full replacement of all their at-pump payment terminals.
While de-branding is sure to be a stressful time for some gas stations, it is important to know that there are experts to help them navigate through these uncharted waters. But engaging with the right payment partner is a critical element of running a profitable unbranded gas station.
For gas stations that are in the process of de-branding, or strongly considering de-branding in the near future, there are plenty of options on how to move forward and success stories to emulate. Reaching out to industry leaders in the sector is the start of that journey. 
Lori Griboski, Vice President of Sales for Paysafe's Petroleum Card Services, Paysafe, began her career with PCS in 2004 and was quickly promoted to an implementations specialist, allowing her to gain a vast understanding of both the petroleum and merchant services industries. She has spent her career creating an exceptional customer experience for PCS merchants, agents and partners. In 2005, PCS was acquired by iPayment, which was in turn acquired by Paysafe in 2018. To contact her, please email kandice.satterfield@paysafe.com.
The Green Sheet Inc. is now a proud affiliate of Bankcard Life, a premier community that provides industry-leading training and resources for payment professionals. Click here for more information.
Notice to readers: These are archived articles. Contact names or information may be out of date. We regret any inconvenience.
Prev Next
