Retailers are being warned that Valentine’s Day 2006 is D-day for Chip & PIN. It marks the start of the ‘no PIN, no purchase’ clampdown. From February 14, shoppers must use their PIN number with their cards – if they don’t, their cards may be declined.Retailers are being warned that Valentine’s Day 2006 is D-day for Chip & PIN. It marks the start of the ‘no PIN, no purchase’ clampdown. From February 14, shoppers must use their PIN number with their cards – if they don’t, their cards may be declined.
Sandra Quinn of the Chip & PIN programme explains: “More than nine out of 10 people have a Chip & PIN card and there are 100 successful Chip & PIN transactions per second. Using Chip & PIN has already cut fraud and now we want to close off even more opportunities for the fraudster.”
At present, 97% of transactions on Chip & PIN debit cards and 89% on credit cards are successfully verified by PIN.
But Paul Sykes, managing director of Shaw Petroleum, believes February 2006 is too soon to adopt a blanket ‘no PIN, no purchase’ policy: “Occasionally customers forget their PIN so we take the risk and let them sign, but our system is online so details are checked at the other end. Then there are still quite a few cards around without chips – I don’t think it would be fair to adopt the new policy before people with new cards have had time to get used to them.” Sykes also said some disabled customers are unable to input their PIN and will always have to sign.
Torex Retail’s UK commercial director Doug Hargrove also has concerns. He said consumers have adopted a ‘very casual approach’ to Chip & PIN because retailers have granted a generous grace period for the new technology to bed in. “This has meant that retailers have generally not enforced a ‘No PIN, no purchase’ policy, which in turn has led to consumers assuming there’s not a problem if they can’t remember or don’t have their PIN.”
Hargrove believes the strict new PIN policy could spell trouble for community retailers who know most of their customers and where applying a ‘no exceptions’ policy could be embarrassing: “It creates an issue of trust for retailers,” he said. “And also, how the retailer is perceived by a consumer who wants to spend but can’t because they lack a PIN number.”