Chime Banking Now Supports Apple Pay

[American Hero]

No, we don't have a problem with "having a bill" -- we don't spend any more than we can pay off every month, in full.

I'm talking about how people would rather use a debit card than a credit card due to charges happening after the fact that not being taken right out of their checking account.

Don't get me wrong: the borrower is ultimately responsible. They just don't teach financial literacy in schools, and too many parents are setting the wrong example for their kids.

I agree with you. I don't care about Greek history. Economics should be a year long course (not 1/2 year) and should cover the more advanced stuff along with the basic responsibilities of every day life situations.

Frankly, the reason a lot of Americans have a problem with credit card debt is because lenders are willing to lend more money than a person can afford to pay back. They do it because high interest rates cover the defaults. High interest rates make payment that much more difficult, and it's a vicious circle.

Credit card companies hate people like me.

For example, my Citi Double Cash pays off 2% back back (or 1% + 1%). I spend roughly $3,000 a month on it, totaling around $60 a month in cash back with no interest fees, so $720 a year.

On top of that, I take advantage of their price rewind program, which gets me back hundreds of dollars every year on items that end up cheaper after I buy them.

So basically I say thank you to Citi for the free American Airline's flight (round trip) to Florida and back every year, roughly $500, and it also covers the cost of the checked bag, fees, taxes, etc. If that trip happens to fall though, I get up to $1,500 trip cancellation coverage.

However, if every customer was like me, companies like Citi would lose a ton of money, even with the swipe fees they charge merchants. They give out more money than someone can afford so people can finance their purchases and pay high interest rates and fees.

That would be an option, but we pay all our recurring bills with a credit card, too -- and collect the rewards.

I wouldn't say "we all," just the smarter people like you and I, who then pay it off as soon as it clears. The typical American doesn't use a credit card unless they can't afford the bill in the first place.

 

[sudo1996]

I was cashless for 18 months.

That ended this week... I'm going on a trip to the Bahamas and have heard credit card readers aren't as ubiquitous there as here. So I withdrew some money from an ATM to take with me. Should know within a few weeks whether cash is still necessary in the Bahamas or that advise to bring cash is dated.

If you take a trip to Berkeley, CA, USA, you'll also need cash. Maybe you can only use credit if you're willing to pay 20% extra everywhere. I came in thinking it would be all high-tech like Silicon Valley, and I was totally wrong.

I looked at Bitcoin recently. It looks like a government could create a cryptocurrency more controllable than the USD and much cheaper and easier for everyone to manage. Some day...

 

[American Hero]

If you take a trip to Berkeley, CA, USA, you'll also need cash. Maybe you can only use credit if you're willing to pay 20% extra everywhere. I came in thinking it would be all high-tech like Silicon Valley, and I was totally wrong.

A merchant can legally only charge up to the cost of taking the credit card, so up to 4%, and nothing more per the card member agreements with the credit card companies. If you find a merchant charging a 20% surcharge on credit card purchases, they need to be sued immediately. Additionally, they cannot surcharge a debit card at all.

 

[tmiw]

A merchant can legally only charge up to the cost of taking the credit card, so up to 4%, and nothing more per the card member agreements with the credit card companies. If you find a merchant charging a 20% surcharge on credit card purchases, they need to be sued immediately. Additionally, they cannot surcharge a debit card at all.

I took his post to mean that most places in Berkeley are cash-only, not that stores there are charging a 20% fee for using a card.

Also, I don't know about anyone else, but the stores around here that have minimums/charge fees for card use don't really care whether it's a debit or credit card or that their 50 cent fee is actually >4% in some cases. They also don't really care if you complain or try to quote Visa rules at them, and if I submitted complaints about every single one of those places I would be in front of my computer for a while. It's easier to pay cash and then try not to go there again.

 

[American Hero]

Also, I don't know about anyone else, but the stores around here that have minimums/charge fees for card use don't really care whether it's a debit or credit card or that their 50 cent fee is actually >4% in some cases.

Legally, they can only give a minimum for credit purchases, not debit.

With a debit card, if they run it as credit, the merchant can impose the minimum purchase amount, as long as it's not greater than $10, just like with a regular credit card, however it costs the merchant more to run the card as "credit" rather than "debit". I would ask if your card can be ran as debit rather than credit if you're using a debit card and you're worried about the minimums for a card purchase.

With that said, one thing I've noticed (at least for the time being) is that purchases made on a debit network typically require a swipe still while credit transactions can be ran as chip read. Sometimes even contactless payments at some merchants need to be ran as credit for it to work. For the average user, running the card as credit is better for them unless you need cash back (which only a few merchants offer)---the transaction is ran through the Visa/MasterCard network instead of directly through to the bank, and it's usually more reliable for mobile/contactless payments.

For me? I live in New York, so companies can't surcharge me for credit card payments over debit. Also, it's so rare for me to see a minimum amount for "credit", that I avoid shopping at merchants who impose that minimum. Some of these companies who do have minimum spending limits only take credit and don't even give you the option to use your card over the debit card networks---in other words a double-whammy of greed and I refuse to do business with them. One example is a business who sells snacks and drinks-- the guy has a $5 minimum, so you can't go in the store and buy a soda and pay for it with your card--like wow, that whole $0.03 must really break your business.
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They also don't really care if you complain or try to quote Visa rules at them,

I'm sure the cashiers couldn't care less, because they don't run the business. However when they start seeing fines and charge backs from the card networks, they'll wake up... Or see that their account has been suspended or revoked by the card networks, they'll most definitely wake up.

nd if I submitted complaints about every single one of those places I would be in front of my computer for a while.

Type up a letter and list a bunch of merchants. Personally I never have that problem, so I don't need to.

 

[tmiw]

Type up a letter and list a bunch of merchants. Personally I never have that problem, so I don't need to.

Basically most small takeout places have minimums/charge extra where I live. However, it usually doesn't come into play because the "usual" order tends to be above the minimum anyway. YMMV of course.

 

[sudo1996]

A merchant can legally only charge up to the cost of taking the credit card, so up to 4%, and nothing more per the card member agreements with the credit card companies. If you find a merchant charging a 20% surcharge on credit card purchases, they need to be sued immediately. Additionally, they cannot surcharge a debit card at all.

I'm pretty sure I've been to places that charge $1 extra to use credit card for a $5 item. If it's not that much, it's always more than 4%. Maybe they can do it because they list separate prices for cash and credit. I know one specific place that charges 10% less for using cash and advertises it as a discount special.

I'm not going to bother filing complaints. You need to carry cash anyway because the subway system only accepts cash in certain stations. And for some reason, the machines that accept credit card are always on the wrong side of the gate if you just got off and need extra money to exit.
[doublepost=1463948815][/doublepost]

I'm sure the cashiers couldn't care less, because they don't run the business. However when they start seeing fines and charge backs from the card networks, they'll wake up... Or see that their account has been suspended or revoked by the card networks, they'll most definitely wake up.

I think their reaction to that here would be to stop accepting any kind of plastic at all. Enough businesses make plastic difficult to use that everyone carries cash, so they don't really need to accept plastic. Maybe that's what happened to Lotus House. One day, they changed to cash only.

 

[American Hero]

I'm pretty sure I've been to places that charge $1 extra to use credit card for a $5 item.

OK, well that's not allowed per the merchant/issuer agreement, sorry. Look it up yourself if you don't believe me.

Maybe they can do it because they list separate prices for cash and credit.

They can certainly give cash discounts, but based on what I've read from you, it seems like the merchants are surcharging credit card transactions higher than 4% .

I'm not going to bother filing complaints. You need to carry cash anyway because the subway system only accepts cash in certain stations.

That's because we live in America. In other countries, you tap your card and go. American's are too afraid and sensitive of such technology.

I think their reaction to that here would be to stop accepting any kind of plastic at all.

Sure if they want to lose business. Only brain dead folks would continue to shop at a place that takes away a payment method they had before. Obviously there's a problem with customers voting with their wallet out there... Because more merchants would take cards if enough customers turned around and walked away when they're told, "cash only, sorry."

Other countries don't have a problem with accepting Visa/MasterCard. Of course businesses in America complain because that's all they do when they have to pay for something that doesn't benefit them.

 

[kdarling]

That's because we live in America. In other countries, you tap your card and go. American's are too afraid and sensitive of such technology.

Don't be ridiculous.

It has nothing to do with Americans avoiding tap & go. On the contrary, they like it.

His SF based complaint is probably about the fact that adding more fare to your BART card can require cash, because of their vending machine limitations and locations.

 

[tmiw]

Don't be ridiculous.

It has nothing to do with Americans avoiding tap & go. On the contrary, they like it.

His SF based complaint is probably about the fact that adding more fare to your BART card can require cash, because of their vending machine limitations and locations.

People in general aren't really bothering with tap payments though, but it's probably not due to fear of them this time (Apple Pay eliminated the part that people feared the most about it). I think there's still a lot of "what's the point" going on; even chip doesn't seem bothersome enough for most without the upcoming optimizations. More stores implementing the loyalty card part of it will help but I'm not sure by how much yet.

 

[American Hero]

It has nothing to do with Americans avoiding tap & go. On the contrary, they like it.

If Americans like it, then why are there so many complaints about the security of the technology?

Why have the banks moved away from RFID technology in cards? If consumers really liked RFID cards, they would've pushed for the infrastructure a little harder, don't you think?

 

[kdarling]

If Americans like it, then why are there so many complaints about the security of the technology?

What complaints?

Also, please note that you responded to someone complaining about having to use cash at times on a subway, because the ticket machines wouldn't take a credit card.

That was not an indication of Americans avoiding tap & go. It was more likely an result of the BART system not upgrading their vending machines and/or placing them correctly.

Why have the banks moved away from RFID technology in cards?

An RFID card is not secure, since it can be read from a pretty good distance, unlike NFC.

If consumers really liked RFID cards, they would've pushed for the infrastructure a little harder, don't you think?

Relatively few people ever got an RFID card, and then they had find/like a gas station that took them.

 

[American Hero]

What complaints?

I've read it all over the place. There's more complaints about RFID cards than those actually thinking they're cool. Americans are afraid of them.

An RFID card is not secure, since it can be read from a pretty good distance, unlike NFC.

There's been advances in the technology where the cards have to be read within a couple of cm's, and not long distances. Even then, advances in the RFID cards send encrypted useless data that can't be used, similar to the token used by mobile wallets.

Relatively few people ever got an RFID card, and then they had find/like a gas station that took them.

I find that hard to believe when Chase, Citi, U.S Bank, Key, HSBC, etc all had RFID cards--the biggest banks in the country.

 

[kdarling]

I've read it all over the place. There's more complaints about RFID cards than those actually thinking they're cool. Americans are afraid of them.

I haven't read such complaints in years.

But for the old RFID cards, they were rightfully wary. That's what gave rise to those shielded wallets.

There's been advances in the technology where the cards have to be read within a couple of cm's, and not long distances. Even then, advances in the RFID cards send encrypted useless data that can't be used, similar to the token used by mobile wallets.

Heck, stats show that even in experienced places like the UK, the majority of the population still thinks contactless cards are the least secure way to pay... and the worry gets worse the further you get from major cities where people are more likely to have used it.

Once educated, they're fine with it.

I find that hard to believe when Chase, Citi, U.S Bank, Key, HSBC, etc all had RFID cards--the biggest banks in the country.

I never owned one, and I have top cards. The only people I know who did, had one for certain gas brands.

Curious: where do you live that people are so anti-tech?

 

[American Hero]

But for the old RFID cards, they were rightfully wary. That's what gave rise to those shielded wallets.

That's what I'm saying.

Heck, stats show that even in experienced places like the UK, the majority of the population still thinks contactless cards are the least secure way to pay... and the worry gets worse the further you get from major cities where people are more likely to have used it.

Once educated, they're fine with it.

Different cultures. Americans are much more resistant to change.

Curious: where do you live that people are so anti-tech?

New York State. (Upstate)

 

[tmiw]

Different cultures. Americans are much more resistant to change.

Eh, people don't seem to eyeroll when using AP anymore around here. Or at least not that I've noticed anyway. Still leaves the question of "value proposition" though, especially when loyalty program support is pretty slim and card transaction times improve to the point where AP via NFC isn't that much faster.

Also, Ziosk is apparently skipping EMV completely since their new model doesn't have a card slot anywhere that I can see (starting at 5:20):

That doesn't sound like "resistant to all technology" to me--more like "resistant to technology that doesn't make much sense". And to most restaurants, I'm not sure EMV makes any sort of sense at all due to their risk profile. In-app bill paying (like what OpenTable does) and to a lesser extent Ziosk and similar, do.

 

[American Hero]

That doesn't sound like "resistant to all technology" to me--more like "resistant to technology that doesn't make much sense". And to most restaurants, I'm not sure EMV makes any sort of sense at all due to their risk profile. In-app bill paying (like what OpenTable does) and to a lesser extent Ziosk and similar, do.

Depends on the restaurant.

A point you're forgetting about is the fact that the waitress has to play cashier by taking the card to the back in most establishments. With that is the risk of stolen card numbers and info, skimming, and tip fraud. Sit down restaurants are actually one of the most vulnerable to fraud and people shouldn't trust employees to take the card to the back or more than a few feet away. Employees are less likely to counterfeit chipped credit cards in a society where 99% or more of the readers only force-read the chip, and yes, restaurants with wireless chip and pin readers should play apart of that role. You have to remember fraud always ends up at the weakest link... So restaurants without chip readers will be the target for fraud along with internet sales.

Once America goes to 95% > EMV transactions vs. 5% mag-stripe, customers will be wondering why a certain business still implements the old method and wonder if card skimming or another way of fraudulent activity is happening behind the scenes. I'm actually in favor of a law stating chip and pin cards are required to be issued, and the card is not allowed to leave the owners hand during a transaction by 2018. Merchants that don't have the correct pin pads would then be liable for fraudulent charges and also a fine per transaction. Consumer facing and wireless terminals should be the norm everywhere while counter-top readers should not be sold by the card reading manufacturers anymore unless they're wireless and used for restaurants businesses only.

I do agree with you about app bill paying at restaurants. However, many old timers who visit restaurants don't even have smartphones, so there needs to be an alternative; hence, wireless chip readers.

 

[tmiw]

Sit down restaurants are actually one of the most vulnerable to fraud

I don't know where you dine out but I've never had the tip changed from what I've written down on the receipt. (I almost always leave adequate tip though so maybe they don't feel the need to do so.) Also keep in mind that it is fairly easy to figure out who's skimming cards by correlating fraud reports with where and when people have used cards, so it's not exactly something that can be kept up for long.

restaurants with wireless chip and pin readers should play apart of that role.

Why, when just any EMV terminal is enough to stop cloning/skimming?

fraud always ends up at the weakest link... So restaurants without chip readers will be the target for fraud along with internet sales.

Thieves will get a much better bang for the buck with online fraud than by scamming restaurants out of a $20-30 check or two. It's why EMV came the most quickly to places like liquor and electronics stores, which sell expensive, easy to resell items.

Once America goes to 95% > EMV transactions vs. 5% mag-stripe, customers will be wondering why a certain business still implements the old method and wonder if card skimming or another way of fraudulent activity is happening behind the scenes.

With zero liability policies in place by basically every card issuer, I don't think it'll matter to consumers as much as you think.

I'm actually in favor of a law stating chip and pin cards are required to be issued, and the card is not allowed to leave the owners hand during a transaction by 2018. Merchants that don't have the correct pin pads would then be liable for fraudulent charges and also a fine per transaction. Consumer facing and wireless terminals should be the norm everywhere while counter-top readers should not be sold by the card reading manufacturers anymore unless they're wireless and used for restaurants businesses only.

Why should the government mandate that when PIN has actually proven to, at best, only improve lost/stolen fraud in the short term?

I do agree with you about app bill paying at restaurants. However, many old timers who visit restaurants don't even have smartphones, so there needs to be an alternative; hence, wireless chip readers.

Almost 50% of people 65 and older own a smartphone. That was back in 2014 so it's likely higher now.

The way I see it, chip and signature and even NFC/contactless are stopgaps until the real transition (to mobile checkout/ordering) takes hold.

 

[American Hero]

I don't know where you dine out but I've never had the tip changed from what I've written down on the receipt.

I've never had that or fraudulent charges from a skimmed credit card, but that doesn't mean it doesn't happen.

Why, when just any EMV terminal is enough to stop cloning/skimming?

Because when we change to chip and pin, it'll make more sense to bring a wireless terminal to the table instead of having the customer get up to do it while the waitress puts the chip in the card reader.

Thieves will get a much better bang for the buck with online fraud than by scamming restaurants out of a $20-30 check or two.

More like scamming whoever's card they skimmed. I'd love a free meal at a restaurant, how about you?

A skimmed card can be used at more than one merchant. They may go out for a $70 dinner and then go buy a $1,500 TV.

With zero liability policies in place by basically every card issuer, I don't think it'll matter to consumers as much as you think.

When something becomes the norm, what is out of the norm gets questioned.

Why should the government mandate that when PIN has actually proven to, at best, only improve lost/stolen fraud in the short term?

The same reasons the Canadian government requires PIN and the card not to leave the cardholder's hand.

PIN could help with combating offline fraud that ends up turning to online fraud. If someone steals my card before I realize it, they cannot make a purchase online if they don't know the PIN number---that is if my scenario actually took place. Also, PIN numbers just make sense... It's how people withdraw money from certain merchants, and it's just more secure in general, even if it only makes up a small portion of overall fraud

Almost 50% of people 65 and older own a smartphone. That was back in 2014 so it's likely higher now.

But many don't, and the number will never be 100%, so cards and EMV will still be used no matter what.

The way I see it, chip and signature and even NFC/contactless are stopgaps until the real transition (to mobile checkout/ordering) takes hold.

Possibly, but people will always use cards. Many people let their phones die, aren't tech savvy, or would just feel more comfortable pulling out their card.

 

[tmiw]

I've never had that or fraudulent charges from a skimmed credit card, but that doesn't mean it doesn't happen.

Of course, but you'd think that Visa would put in some rule requiring cards to not leave one's sight if it were really a big enough issue for banks to care.

Because when we change to chip and pin, it'll make more sense to bring a wireless terminal to the table instead of having the customer get up to do it while the waitress puts the chip in the card reader.

Key word is "when". I think we won't ever see PIN on a widespread basis precisely because it won't help all that much. Think about all the people who will just use 1234 or something else that's easily guessable, for instance. Mandating a longer PIN might not go over well either if people are already using "can't remember multiple PINs" as an excuse.

Biometrics on physical cards on the other hand? Maybe. But they might just try to push Apple/Android Pay use instead.

A skimmed card can be used at more than one merchant. They may go out for a $70 dinner and then go buy a $1,500 TV.

There are a lot more restaurants than electronics stores, so the risk is still lower for the former.

When something becomes the norm, what is out of the norm gets questioned.

The norm is apparently going to still be "hand card to cashier so they can insert into their terminal", with being able to do it yourself still predominantly at the larger retailers and grocery stores. And ID checks occasionally.

PIN could help with combating offline fraud that ends up turning to online fraud. If someone steals my card before I realize it, they cannot make a purchase online if they don't know the PIN number---that is if my scenario actually took place. Also, PIN numbers just make sense... It's how people withdraw money from certain merchants, and it's just more secure in general, even if it only makes up a small portion of overall fraud

In other countries, PIN isn't used at all for online purchases. It's usually an online banking password, a one-time code received via SMS or something else that's similar.

But many don't, and the number will never be 100%, so cards and EMV will still be used no matter what.

I don't expect us to suddenly stop using physical cards. It'll probably be like checks where use slowly declines. There might end up being low enough demand such that you have to explicitly opt into getting a physical card.

 

[American Hero]

Of course, but you'd think that Visa would put in some rule requiring cards to not leave one's sight if it were really a big enough issue for banks to care.

It's not about the banks. I as the consumer care. They work for me... They don't tell me what to do. I tell them what to do. If Visa and MasterCard decide the banks are more important I'll be more than happy to swipe/insert/tap a Discover or American Express card everywhere I shop instead.

Key word is "when". I think we won't ever see PIN on a widespread basis precisely because it won't help all that much. Think about all the people who will just use 1234 or something else that's easily guessable, for instance. Mandating a longer PIN might not go over well either if people are already using "can't remember multiple PINs" as an excuse.

Our politicians and the FBI, Discover, etc., are already working on it... Although that doesn't mean it's a 100% certainty it will happen. I see the PIN happening because major retailers are also fighting for it, like Walmart for instance. Plus, like I've said before, people want to withdraw cash at the register sometimes---which you can't do with a signature. PIN also allows for a lower interchange fee, which is why Walmart is all up in arms about not having it.

Biometrics on physical cards on the other hand? Maybe. But they might just try to push Apple/Android Pay use instead.

That would be incredibly awesome to have. I think KDarling mentioned that before.

The norm is apparently going to still be "hand card to cashier so they can insert into their terminal", with being able to do it yourself still predominantly at the larger retailers and grocery stores. And ID checks occasionally.

I'll never show an ID to a cashier. Check the signatures or take the last four numbers down. The card is programmed to what it wants the register to do. So if the card is programmed for chip and pin--the cashier is out of luck, and soon enough with enough of these cards the complaints will be loud about getting a terminal that requires easy access to from the customer's perspective.

In other countries, PIN isn't used at all for online purchases. It's usually an online banking password, a one-time code received via SMS or something else that's similar.

I know but I'm just saying it would be a more secure scenario than what we have now.

I don't expect us to suddenly stop using physical cards. It'll probably be like checks where use slowly declines.

However people still use checks and always will. Most landlords still take check only. There will always be people renting an apartment to live in. As much as I (and probably you) get annoyed with people who use checks at the grocery store, they won't disappear permanently and neither will cards.

 

[tmiw]

It's not about the banks. I as the consumer care. They work for me... They don't tell me what to do. I tell them what to do. If Visa and MasterCard decide the banks are more important I'll be more than happy to swipe/insert/tap a Discover or American Express card everywhere I shop instead.

The banks are the ones covering the fraud though. Apparently it's acceptable enough for them to keep doing what they're doing.

Our politicians and the FBI, Discover, etc., are already working on it... Although that doesn't mean it's a 100% certainty it will happen. I see the PIN happening because major retailers are also fighting for it, like Walmart for instance. Plus, like I've said before, people want to withdraw cash at the register sometimes---which you can't do with a signature. PIN also allows for a lower interchange fee, which is why Walmart is all up in arms about not having it.

FBI/government agencies can't do anything to mandate it except for their employee charge cards. Senator Durbin is mainly trying to get EMVco investigated right now and is also approaching things from the interchange fee standpoint; this means that any law changes or court rulings would probably only affect debit cards--which already have an (optional) PIN.

Which leaves Discover. While they did announce something to that effect, I don't think they really gave any ETA. Kinda like what Chase did before they gave up on the idea altogether, come to think of it.

So if the card is programmed for chip and pin--the cashier is out of luck, and soon enough with enough of these cards the complaints will be loud about getting a terminal that requires easy access to from the customer's perspective.

Which can be done without having a dedicated PIN pad if you position the terminal properly.

However people still use checks and always will. Most landlords still take check only. There will always be people renting an apartment to live in.

I don't think cards were ever really designed for that use case.

 

[American Hero]

The banks are the ones covering the fraud though. Apparently it's acceptable enough for them to keep doing what they're doing.

They get their fraud coverage from my interchange fees, which usually results in a profit since fraud on my credit card has happened once in 5 years I've owned a credit card, and 0 times in 9 years I've owned a debit card.

Senator Durbin is mainly trying to get EMVco investigated right now and is also approaching things from the interchange fee standpoint; this means that any law changes or court rulings would probably only affect debit cards--which already have an (optional) PIN.

I think Durbin wants a PIN on both, not just debit cards. The guy has already done enough damage to the consumer with debit cards, so he should keep his nose out of the card companies' business. Having a signature debit card isn't a smart move---like I've said before, cash withdrawals at the register, the increased security of a PIN, and the refresher of what the PIN number is so you can use it at the ATM are all advantageous to the consumer. Debit cards are riskier to use, so they should require a PIN. While the bank may eventually cover the fraud and lie about that "zero liability," even though it'll take them a month to investigate and reimburse your money (unlike with a credit card), I personally would not want to go through the hassle of doing an investigation, re-changing my payment information with certain businesses, etc.

Which can be done without having a dedicated PIN pad if you position the terminal properly.

Yes, exactly. But that is the problem... Many places to not have terminals positioned properly. Many food places have this problem.

 

[tmiw]

They get their fraud coverage from my interchange fees, which usually results in a profit since fraud on my credit card has happened once in 5 years I've owned a credit card, and 0 times in 9 years I've owned a debit card.

Not quite. It was more that the revenue they got from card swipes/interest/fees was more than enough to counteract losses from fraud until very recently.

I think Durbin wants a PIN on both, not just debit cards. The guy has already done enough damage to the consumer with debit cards, so he should keep his nose out of the card companies' business. Having a signature debit card isn't a smart move---like I've said before, cash withdrawals at the register, the increased security of a PIN, and the refresher of what the PIN number is so you can use it at the ATM are all advantageous to the consumer. Debit cards are riskier to use, so they should require a PIN. While the bank may eventually cover the fraud and lie about that "zero liability," even though it'll take them a month to investigate and reimburse your money (unlike with a credit card), I personally would not want to go through the hassle of doing an investigation, re-changing my payment information with certain businesses, etc.

"Signature" debit (really debit over Visa/MC) actually was a good move on their part. Debit networks have absolutely failed to get significant traction among merchants (and are still failing now), so keeping debit cards "PIN" debit would have effectively made the cards unusable anywhere other than at ATMs. These days, it's really only grocery stores and major retailers that support STAR, PULSE, etc.--and not all debit supporting stores even support features like cash back. The UK has something similar, with POS transactions on debit cards going over Visa/MC and ATM transactions going over LINK.

BTW: http://krebsonsecurity.com/2016/05/skimmers-found-at-walmart-a-closer-look/. More widespread chip acceptance would have helped far more to prevent that than requiring a PIN everywhere.

Yes, exactly. But that is the problem... Many places to not have terminals positioned properly. Many food places have this problem.

It'll just mean that the terminal gets moved closer, not necessarily that the merchant will spend yet more money to buy another piece of equipment that's not strictly needed.

 

[American Hero]

Not quite. It was more that the revenue they got from card swipes/interest/fees was more than enough to counteract losses from fraud until very recently.

It's still enough to cover the fraud. The government told the card issuers to reduce their debit card fees because the percentage charged to the merchants was too high for the amount of fraud that actually exists.

Credit card fees weren't touched, and the government should leave it alone. I like all of the benefits and higher rewards I get from credit cards BECAUSE they have higher interchange fees.

Debit networks have absolutely failed to get significant traction among merchants (and are still failing now)

One reason they're failing is because of the EMV problem with debit certification. You can thank Durbin for that one, as well as a reduction in debit card rewards and free checking accounts (although they still exist to a much lesser extent). It's still weird to be able to withdraw cash at a cash register from your checking account without typing in a pin, while at the same time, having a PIN required at an ATM.

so keeping debit cards "PIN" debit would have effectively made the cards unusable anywhere other than at ATMs.

However, those cards would be world capable in countries that have adopted chip and pin. I understand you can still use your chip and signature card at manned POS systems, but it's much more difficult to fuel up at the pump or buy train tickets without a card that has a PIN attached to it and set as the priority.

not all debit supporting stores even support features like cash back.

I love how Wegmans supports cash back at the register. I can get $10 bills instead of forced into getting $20's when I don't need them; I can save myself the $1 fee the store's ATM owner charges, and I can also save the $2.50 fee my bank would have charged. I'll save $3.50 per withdrawal and keep my card PIN. If I let someone borrow my card, with a pin, I can protect against them just draining my bank account and grabbing cash, where as with just a signature, they can just take all of my money.