Forum Moderators: buckworks
The nation's retailers received final approval yesterday of a $3 billion settlement with Visa USA and MasterCard International, which will lead to substantial reductions in certain transaction fees.
Under the terms of the settlement, a merchant will no longer be required to accept Visa or MasterCard's debit cards to accept the companies' credit cards, and vice versa, starting Jan. 1.
The country's largest retailer, Wal-Mart Stores, announced this month that it would take advantage of that option and in February would allow customers to use their MasterCard debit cards only if they enter a personal identification number, which carries a lower fee for the retailer.
[nytimes.com...]
So - who's going to go to PIN only transactions for debit cards... anyone? That's a very bold move for Wal-Mart.
Id bet that it wont affect their business. Just a hunch
As I understand it, you can only initiate a debit card PIN transaction when you have a magnetic capture. In other words, the card must be physically present. This settlement shouldn't affect ecommerce.
Personally I think Walmart will come back around, they are just trying to start negotiations.
PayPal users
And lots others. USAA, the US armed forces bank/services company, offers the same cash-back deal on debit-card signature transactions. That's a huge base. Plus, I'm pretty sure there are at least 2 major commercial banks doing the same thing.
Although, I'm with Essex_Boy - I'm not sure if Wal-Mart will switch back. Will people stop buying at Wal-Mart because they can't get their 1.5% cashback? IMHO, Wal-Mart purchases tend to be those of impulse or immediate convinence. So, I don't know how negatively it will affect them, if at all.
you can only initiate a debit card PIN transaction when you have a magnetic capture
Yes, that's how I understand it too (although I do believe there are exceptions to this). But with the increased competition from debit card processors, I can see this changing in the near-term.
Would you buy something on the internet using your PIN? Is that really any different than buying something using a 16 digit debit card number in MC/Visa form?
