Credit Cards without Chip & Pin ?

duggie1982

Yip that true. Visa/Mastercard said to retailers that if they use the chip and pin system then they are guaranteed their money

M_Thomson

CannyJock wrote: »

Got involved in a few projects rolling out chip and pin EPOS systems with retailers when it all started - from memory at an APACS briefing at the sunny Glasgow Hilton they made it clear that if the retailer accepted payment without a pin number then they were liable for any fraud, but with a pin number the banks were liable. But this wasn't to protect the banks. Oh no, definitely not. Could explain why the small guys just point blank refuse to take the risk?

Not quite the case. The rules are as follows: If a card is magnetic stripe only, without a chip which cards issued in some countries like America and Australia are, retailers must take the cards. They are breaking their merchant agreement if they don't. The retailers are not liable for fraud in magnetic stripe cards provided they have followed all the rules for checking cards. If a card is Chip and signature, again retailers are not liable for any fraud providing they check the cards signature properly. If a card is Chip and Pin and the retailer bypasses the pin and lets the customer sign and the transaction turns out to be fraudulent the retailer is liable for the fraud. If the retailer accepts the pin and it turns out to be fraudulent they are not liable for the fraud.

M_Thomson

jegudiel wrote: »

Do bear in mind that some shops will turn you away. I have an American card (i.e. no chip and pin) and although most shops and mainstream shops understand that they have to accept non chip and pin transactions, I still regularly come across jobsworths who say they can't (normally smaller shops).

Read my post above. They are breaking their merchant agreement. Very silly of them to turn business away!

chattychappy

M_Thomson wrote: »

Read my post above. They are breaking their merchant agreement. Very silly of them to turn business away!

Yep silly - but a cardholder isn't in a position to enforce a merchant agreement at the point of sale. Actually I doubt whether any term/condition that says a merchant must accept a card in a particular circumstance is really enforceable, except perhaps via disability discrimination rules.

I agree with the sentiment of the thread - PINs are about shifting liabilities. I think they are a poor proxy for a real ID/authorisation check. I'm sure in a few years it will all be done away with as banks fail to succeed in using "PIN entered" as sufficient evidence of cardholder authority/negligence.