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Aug 2016

TSG in NYT: Confused by Chip Credit Cards? Get in Line

There is reason to hope.

About 75 percent of credit cards are chip-enabled. If all businesses upgraded their terminals — which they are not required to do by law — at least the confusion over whether to swipe or insert would be settled.

So far, about one-quarter of the nation’s merchants have made the transition, said Jason Oxman, chief executive of Electronic Transactions Association, a trade group for companies that deal with payment products and services.

But while many of them have the terminals, they are waiting to get them certified for use, said Jared Drieling, the business intelligence manager for the Strawhecker Group, a consulting company for the industry.

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Aug 2016

TSG in the News - Muddy Waters for Chip and PIN Technology, Banks Won't Sign Off

The Strawhecker Group, an electronic payments advisory firm, estimates that the payment processors are on track to have more than 90% of their merchants EMV-ready by 2017 or later. That represents almost 4 million retailers.

Information from some of the nation's top retailers confirms the data. The Walgreen Company began transitioning drug stores to the new EMV technology more than three years ago when it installed new point-of-sale terminals. The upgrade involved about 60,000 POS terminals in 8,200 Walgreens stores.

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Jul 2016

TSG in the News - What PayPal and Visa's Partnership Means

The deal gives PayPal more fuel to expand its footprint into physical stores through the VDEP platform, helping PayPal extend its online payments dominance to physical stores. PayPal has made several efforts to get into the physical payments space over the past several years, says Jared Drieling, business intelligence manager with electronics payments consultancy The Strawhecker Group. “This partnership may help PayPal get into the physical store in a more meaningful way through the mobile device,” Drieling says.

For Visa, the deal is designed to help it reach more consumers. Before PayPal struck a deal with Visa, the payments processing company would encourage its users to deduct payment transactions from their bank accounts (as opposed to credit cards) through the Automated Clearing House system (ACH), which connects financial institutions outside of payment card networks. Fees on ACH transactions are only a few pennies, making them a less expensive transaction for PayPal to process than a credit card transaction, for example. Now, PayPal place equal weight to ACH and checking account options for its users.

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Jul 2016

TSG in the News - Nearly Half of the Largest U.S. Retailers Aren't EMV-ready: Why?

About 45 percent of the largest U.S. retailers aren’t fully compliant with EMV standards, according to a CreditCardForum survey.

In June 2016, we looked at the Top 20 retailers (by volume of sales according to the National Retail Federation) and found that eight still hadn’t completely upgraded their equipment to accept the more secure EMV chip cards.

You can see our full results and methodology here. But the bigger question is: why haven’t these commercial giants upgraded – especially given that the deadline (set by the card networks – Visa, MasterCard, American Express, Discover) was last October? We asked Jared Drieling, business intelligence manager with the Strawhecker Group – which recently did a survey that found 37 percent of U.S. merchants overall had upgraded to EMV.

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Jul 2016

Now Available: EMV Merchant Planning & Strategy Guide

This report (76 pages of detailed information) can act as a strategic tool at higher levels within your organization or can be leveraged to educate and arm front-line personnel such as sales teams when visiting clients who may be encountering EMV issues or be planning to migrate to EMV. 
 
This eReport will:
  • Explain what EMV is
  • Explore the current state of migration in the U.S.
  • Provide a comparison of the U.S. migration to other global experiences
  • Review chargeback trends post-EMV liability shift
  • Provide steps merchants can take to efficiently implement EMV
  • Discuss merchant best practices 
  • Explore merchant obstacles and startegies to overcome those obstacles

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Jul 2016

TSG in ISO & Agent: Merchant Cash Advance - Competition Heats Up

Even though it is more expensive than other types of funding, merchant cash advance has seen steady growth as a small and mid-sized business financing option, particularly after financial institutions tightened their lending purse strings in response to the financial crisis. The Strawhecker Group estimates that merchant cash advance is now a $6 billion annual industry, up from about $4 billion just a few years ago, notes Jared Drieling, Business Intelligence Manager, with the Strawhecker Group.

“Merchant cash advance is growing at a strong clip,” says Driel- ing. “Small businesses that were either turned down by tradi- tional banks or found that the loan process was too lengthy are turning to cash advance.”

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Jun 2016

TSG in WSJ - ‘Brexit’ Leaves Europe’s Fintech Firms in the Lurch

Europe’s financial-technology upstarts are scrambling to figure out what the United Kingdom’s departure from the European Union and its digital payments rules means for their businesses.

“The U.K. will no longer be required to implement or follow any EU payments legislation, which could clearly impact the payments environment,” wrote analysts at The Strawhecker Group, a payments research firm.

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Jun 2016

TSG in Transaction Trends

  • Managing EMV Expectations
    • October 1 wasn't a deadline; it was a starting point. We asked ISOs, acquirers, and other payments professionals for their views on the chip card implementation process to date. Read More

 

  • EMV: Where the Merchants Are
    • From the merchants' perspective, the EMV transition has been less than perfect. While the big and very small are handling the shift to chip cards, it's slow going for mid-sized merchants, according to retail groups. Here's why. Read More

Jun 2016

Now Available: Subscription/Recurring Market Analysis & Directory

TSG's new market analysis of independent software providers (ISVs) contains a detailed look on the subscription/recurring revenue industry. This includes a high-level analysis on the market, merchant acquiring performance metrics, and a directory of 34 ISVs.

Did you know that you should be penetrating this market?

  • There were more than twice as many card-accepting merchants within the Continuity/Subscription market (MCC 5968) in 2015 compared to 2014
  • Based on the Forbes Top 2000, an estimated 35% of the companies generate revenue via a subscription model

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Jun 2016

TSG in Digital Transactions: Harbortouch Swaps Private-Equity Partners in Deal Valued at $500 Million-Plus

Analyst Jared Drieling, business-intelligence manager at The Strawhecker Group, an Omaha, Neb.-based payments consultancy, suggests Harbortouch could one day offer an expanded line of so-called smart POS terminals, which run on apps that include payments but also a wide range of other business-management functions.

“Smart terminals are a hot item for ISOs to go out and sell,” Drieling tells Digital Transactions News. “This [new investment] is an opportunity to grow and take market share away from the smart-terminal players in the market. It’s a window of opportunity for Harbortouch, which is why it’s seeing increased interest from investment companies. [For acquirers], it’s all about adding value-added relationships to create that sticky relationship. If you can provide a smart terminal with value-added services, that becomes pretty sticky [and attractive to investors].”

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