7 steps credit unions can take to counteract PINless debit


first_img 1SHARESShareShareSharePrintMailGooglePinterestDiggRedditStumbleuponDeliciousBufferTumblr PINless debit has been in use for many years. It allows certain merchant categories to bill debit cards for things like utility bills and Internet charges, where entering a PIN created additional security concerns. The use of PINless debit complies with the Durbin Amendment and cuts merchant interchange rates in half.When a merchant processes a lot of sub $50 transactions, they can re-route debit transactions off of Visa and MasterCard and on to EFT networks (such as STAR and NYCE). In most cases, this happens without consumer knowledge or permission. Meanwhile, according to recent reports, the number of retailers implementing re-routing is on the upswing.The impact to credit unions is a reduction in interchange fees. According to the Federal Reserve, for exempt Financial Institutions—those under $10 billion in assets—the average interchange fee per transaction for a transaction processed over Visa’s or MasterCard’s networks is $0.50, compared with $0.26 for transactions processed over most of the PIN networks. That’s nearly half! continue reading »last_img

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