Online PIN-Only Debit Card Processing: What Gives?

In the tradition of always keeping our clients informed and educated about current industry developments, today we’ll address the issue of online, PIN-only debit card processing, perspectives on the topic from industry officials, and how it affects you, the merchant, in your daily card processing – and other online card processing – needs.

Until just recently, no PIN-only debit card holder could use his card online. The online checkout flow and peripheral applications, coding, and databases, simply did not support a PIN-only scenario and related to a PIN-only debit card as to any other debit or credit signature card. No online payment page enabled entering just a PIN code, and the checkout flow did not pass the PIN code to the debit card issuer. As a result, online, PIN-only debit card transactions were declined, as the PIN needed to authenticate the transaction was missing.

While most online merchants still do not accept PIN-only debit cards, first online PIN-only solutions are finally being developed, and new card processing solutions are on the way!

To the joy of online shoppers everywhere, PULSE has recently introduced the PULSE® Internet PIN debit solution, which enables merchants to accept PIN-only debit cards issued by the PULSE issuers’ network. The solution enables shoppers to enter their PIN using a graphical, scrambling, PIN pad, which changes each time a digit is entered.

The upcoming Durbin Bill is expected to accelerate the adoption of online PIN-only debit card processing methods. Though the Bill does not apply to PIN-only debit cards, it targets an issuer interchange cap of $0.12 for an online signature debit card transaction.

As issuers will have to find a way to gain the lost interchange back, and as the suggested cap only applies to signature debit cards – yet does not apply to PIN-only debit cards – issuers’ one course of action would be aggressively marketing PIN-only debit cards over signature debit cards, and changing the debit card market. Such a change will provide merchants with a larger incentive to accept PIN-only debit cards to maintain their market share.

Vision Payment Solutions is committed to providing the highest quality card processing solutions at the most reasonable cost possible. We offer all the hardware, software, and technical support you need to get your business breezing through card processing, and making all your customers happier, more loyal shoppers! Contact us today to find out about our equipment-leasing program, and see how we can help you with your business.