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Feb 2016

Survey Estimates 37% of U.S. Card-Accepting Merchants Are EMV-Ready

TSG released survey results that estimate 37 percent of U.S. merchant locations are EMV-ready four months after the October 1st, 2015 liability shift.

TSG's previous survey of payment processors and other payment providers completed last September estimated that over 40 percent would be EMV ready by this time, showing a slower pace of implementation than expected before the shift.

By June 2016, it is estimated that consumers will be able to use their EMV credit and debit cards at 50 percent of U.S. merchant locations. EMV-readiness is not expected to reach a threshold of least 90 percent of merchant locations until 2017 - more than 15 months after the shift.

See the infographic.


Jan 2016

TSG in Digital Transactions - In a Bid to Build on Strengths, TSYS Clinches a $2.35 Billion Deal To Buy TransFirst

TSYS has been interested in TransFirst for the past two years, Jared Drieling, business intelligence manager at payments consultancy The Strawhecker Group, tells Digital Transactions News. “It definitely makes sense for a couple of reasons,” Drieling says. “Clearly, TransFirst is a little more focused on small and mid-size businesses, where TSYS has a little more focus on larger retailers. As we’ve seen with other merchant acquirers, the more profitable segments are in the small and mid-size sector.”

The other factor is that the TransFirst acquisition is an opportunity for TSYS to broaden its products and services, Drieling says. “TSYS has been somewhat conservative on the technology front, especially along the omnichannel front,” he says. Other processors have already begun to tackle how to offer payments services when the lines between physical and digital payments are blurring, he says. “TransFirst really brings together other areas, such as integrated payments and omnichannel services.”

Like the recently announced Global Payments Inc. deal to buy Heartland Payments Inc., the TSYS-TransFirst deal is about building on top of what each company already has developed, Drieling says.


Nov 2015

TSG in CIO: For Retailers, Confusion Reigns After EMV Rollout

Still, this is just the beginning of a lengthy migration process, says Jared Drieling, business intelligence manager at The Strawhecker Group, a management consulting company focused on the global electronic payments industry. “There are pluses and minuses associated with EMV but all in all, we need to view this as the starting line versus a deadline,” he says. “I don’t think that this confusion is a bad omen for EMV’s future – this is a large and complicated migration, so it will take time.”


Nov 2015

Michael Dooley Joins The Strawhecker Group as Director of Business Development

The Strawhecker Group (TSG), has announced today the addition of Director of Business Development, Michael Dooley who brings over 20 years of deep experience in managing sales and client projects. Dooley will use his expertise to help TSG reach new heights and grow its dedicated consulting practice by improving speed and efficiency.

"Dooley is a major addition to TSG," said Kurt Strawhecker, Managing Partner. "His industry experience, coupled with his consulting background, will be a great benefit for clients, further cementing TSG as the industry's leading provider of advisory services," added Strawhecker.

Continue reading.

Nov 2015

ETA Helps Tech Companies Find Opportunity in $5 Trillion Payments Industry

ETA and The Strawhecker Group revealed the latest research on the future of FinTech at TRANSACT Tech. The report shows the payments industry is a lucrative growth sector for startups and established industries alike because it embraces innovation and companies are eager to form partnerships to fill gaps or gain a competitive edge in the marketplace. ETA Members can access the report here.

Globally, the report found that nearly 800 payments mergers and acquisitions occurred between September 2014 and September 2015, netting an average price of about $90 million per deal. Half of those deals were in the U.S. market. Top company categories include crypto currency, mobile payments and card processors.


Oct 2015

TSG in Digital Transactions: Merchant Acquirer TransFirst Takes Another Stab at an IPO

TransFirst’s timing of its IPO is intriguing given the number of payments companies with IPO announcements, says Kurt Strawhecker, managing partner of Omaha, Neb.-based The Strawhecker Group, a payments advisory firm.

“The list includes Worldpay, First Data and Square,” Strawhecker says via email. “This would appear to indicate the overall strength and continued growth potential of the payments industry—especially in the face of a few other IPOs so far this calendar year.”

It may not hurt that payments is getting a lot of attention this year, especially among the broader consumer press because of the EMV migration and mobile commerce, he says. “Current public payment stocks such as Visa, Vantiv and MasterCard have been strong performers, so it may feel like a ripe time from the perspective of these investment entities to get these companies back into the public markets,” he says.


Oct 2015

TSG in The Green Sheet: A Week to Remember for Payments IPOs

The week of Oct. 12 to 16, 2015, was a historic one for payments industry IPOs, with Worldpay Group plc going public Oct. 13 on the London Stock Exchange and two days later First Data Corp. on the New York Stock Exchange. Before the week was over, two more companies had filed registration statements with the U.S. Securities and Exchange Commission for proposed IPOs, Square Inc. on Oct 14 and TransFirst LLC on Oct. 16.

Capital investment in the financial technology sector has been consistent as competition heats up nationally and globally. "Current public payment stocks such as Visa, Vantiv and MA [MasterCard] have been strong performers," said Jared Drieling, Business Intelligence Manager for The Strawhecker Group. "This clearly indicates that some of the major investment firms and equity groups feel that this is an ideal time to offload or minimize their investments in these payment companies since the payments market is hot."


Oct 2015

TSG in MIT Technology Review - Why Apple Pay’s Slow Start Doesn’t Mean It’s a Failure

Exactly what we should have expected, actually. It was never a secret to those close to the payments and retail businesses that usage of Apple Pay would be slow to build. Here’s why: although many major retailers such as Rite Aid, McDonald’s, and Best Buy take Apple Pay, only 27 percent of U.S. retail outlets, which include millions of small businesses, have the new checkout terminals needed to accept it, according to a September 17 study by the Strawhecker Group, a payments consultant. As a result, it’s hard even for people who have used Apple Pay to get in the habit of paying with it.


Oct 2015

TSG Commentary on EMV - Anecdotes from Around the Country

TSG Associates were trying to use their chip cards around the country over the last week – here are some of their experiences:


  • “The first dip I had was at a small liquor store in Estes Park over the weekend and then Home Depot today. I wonder if liquor stores are more concerned with fraud?”
  • “My local drycleaner was under the impression that EMV was a government enforced law.”


  • Sign posted at a local vitamin shop: “Until our equipment is able to take chip cards, all credit card transactions over $25.00, will require a photo ID” “All transactions over $250.00, will require address verification”
  • “Just had my first dip of a chip at Home Depot - they just went live and the clerk was very well informed of the process and Oct. 1 date, etc.”

Continue reading.

Sep 2015

Which Types of Retail Merchants are EMV-Ready?

The Strawhecker Group (TSG) released data today, ahead of the October 1st liability shift, that represents EMV-readiness by merchant type. Among merchants in the retail category, 69 percent of Shoe Stores and 59 percent of Department Stores have EMV-ready terminals. On the lower end of the spectrum, 23 percent of Stationary Stores and 24 percent of Book Stores have EMV-ready terminals.

“It makes sense that certain retail merchant types are more ready than others for the liability shift, as some are much more likely to potentially see fraudulent transactions,” says Mike Strawhecker, Principal at TSG. “While many retailers have not yet upgraded their terminals, big-box merchants such as Walmart and Target are ready for October 1st.”

Click to read more.

In conjunction with this release, TSG has published a chart looking at 30 retail merchant types and their respective EMV-readiness: https://gallery.mailchimp.com/fdd15cca0b92ae5a85c1daf76/files/Why_Types_....