Walmart, Home Depot suing Visa, MasterCard over not allowing use of chip+PIN

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in legal on (#1J34H)
story imageHome Depot filed an antitrust lawsuit in federal court this week against credit card giants Visa and MasterCard for blocking the adoption of chip-and-PIN on credit card transactions. Instead, the companies adopted the less secure chip-and-signature method, which does not prevent lost and stolen cards from being used. Merchant groups, consumer advocacy groups and even the Federal Bureau of Investigation (FBI) called attention to the need to adopt chip-and-PIN in order to take full advantage of EMV security. According to data compiled by the U.S. Federal Reserve, transactions routed over Visa's or MasterCard's signature debit networks cost retailers more than twice as much as transactions routed over PIN networks.

Home Depot's case against Visa and MasterCard is similar to one Walmart recently filed against Visa. In that case, Walmart says that Visa is precluding the retailer from requiring PINs on all debit card transactions. As a result, Walmart is forced to pay the fees associated with signature-based networks. For the world's largest retailer, that figure is in the billions.

Visa and MasterCard, along with groups such as the American Bankers Association, have said that requiring PINs with credit card transactions could cause confusion for consumers. Visa has also said that newer, better authentication technologies (such as biometric and geo-location verification) are just over the horizon.
Reply 6 comments

Confusion? (Score: 1)

by seriously@pipedot.org on 2016-06-23 07:41 (#1J3NF)

requiring PINs with credit card transactions could cause confusion for consumers
We've been using credit cards with PINs in EU for at least 10 years (country-dependent, some countries have been a bit slower) and I don't remember anyone being confused about it. What kind of confusion are they talking about? Maybe mixing up the various PINs we use (phone, debit card, eID, etc.)? or some other kind of confusion?

Re: Confusion? (Score: 3, Interesting)

by evilviper@pipedot.org on 2016-06-23 08:32 (#1J3RM)

That's the catch-all term used when someone doesn't want to change something. People are accustomed to signing, so asking them to enter a pin is a change. Anyone who deals with the public knows there are a few who are unable to follow the simplest instructions, and will get frustrated when any routine in their life is changed.

It costs some money to include a flier in each monthly bill explaining the change. And any changes will cause a little bit of slow-down when phased-in, but it is actually the retailers who will bear the slow-down who are DEMANDING this change.

Re: Confusion? (Score: 0)

by Anonymous Coward on 2016-06-23 12:30 (#1J4A4)

Australia has had chip and pin for years. It recently changed to Tap and Go, with pin entry only required for large transactions

Re: Confusion? (Score: 0)

by Anonymous Coward on 2016-07-21 12:17 (#1N17P)

Same deal in Canada. Even if the US merchants get this sorted out, they will still be one full generation behind. There are also implications to things like Apple Pay. I used this once in the US and the cashier pulled off the receipt and asked me to sign it afterwards. Why the hell would I bother using Apple Pay if I also have to sign my signature as well? And this was for a small transaction (groceries).

The big ships... They turn slowly...

US Problem (Score: 3, Informative)

by vanderhoth@pipedot.org on 2016-06-23 10:40 (#1J41V)

Kind of funny because Canadian Walmart stores are also starting to boycott Visa for high fees.

But I don't get why this chip+pin thing is an issue in the states. In Canada all of our cards are chip+pin now, and have been for awhile. We're actually on the verge of going to NFC from phones using the MintChip application developed by the Canadain Mint. (I don't trust NFC and likely won't be using MintChip until it's an absolute necessity because there's no other options.)

Tried the same with my landlady (Score: 0)

by Anonymous Coward on 2016-06-26 06:08 (#1JD8K)

Me: I'm paying way too much. Please let me pay less.
Her: Nah, it's fine. You wouldn't like it anyway.