Why don't credit cards require PIN's?

[joeunderdog]

Lack of technology used to be an argument, but now it's hard to believe that that is the case. They could save billion$ on theft if they required a PIN, but they leave the door wide open for ongoing theft that costs all of the customers in the end. It's so obvious that they could benefit from adding safeguards, but they don't do it.

Retailers used to ignore shoplifting until they got smart and installed cameras, saving billion$. What alterior motives do the banks have for NOT requiring PIN's or some other form of ID for credit cards?

[OldLeftieLawyer]

1. Good question

That would add another layer of security, but also another layer of work for the company, and perhaps increase the cost of doing business for them.

God knows they're running on such a narrow profit margin now, as it is. :sarcasm:

[RB TexLa]

2. I hope they never do

They have already added the stupid "thee number security code" to the number on the back.

[MissB]

8. And don't you just love giving that one out?

:scared:

[SammyWinstonJack]

3. I think credit cards do require a pin if you are withdrawing cash from

them. :shrug: You can use your ATM card without a PIN if you designate it as credit.

[unblock]

4. most transactions require a signature or the 3-digit number on the back

so you have to forge a signature or physically have the card.

if you forge a signature they have hard evidence that might tie you to the crime.
if you physically have the card most card owners will report it stolen/missing pretty quickly.

some places will let you charge up small balances without either (like mcdonald's) but i suspect that they have an arrangement to permit that (i.e., they pay slightly more per transaction, which goes towards extra insurance for the card company).

[SemiCharmedQuark]

11. Gas Stations don't...

And it was a gas station where someone ran up an 80 dollar bill with my card. (but that was my debit card...since they have started requiring PIN numbers---)

[uppityperson]

5. can get gas at a drivethrough place with credit card, no signature nec.

this seems a bit odd to me.

[Cleita]

6. I thought it was because no cash was involved.

When you use a credit card you incur debt that you pay later. When you use a debit card, you are spending money you already have in your bank account or so I thought anyway. Also, what if someone gets a hold of your pin? They can empty your bank account but no more. If they get ahold of your credit card pin, on the other hand, they could max out your credit limit and you would have no recourse because they used your secret pin number.

Just some thoughts anyway. What the heck do I know? :shrug:

[Missy M]

7. With a debit card or ATM card there is a limit to what you can...

withdraw from your checking account in one day, so they can't wipe out your bank account if you have more than the limit in the account.

[porphyrian]

9. Because you have to sign to use them. - n/t

[SemiCharmedQuark]

10. A lot of people don't sign though, they write "See ID"

Or they do both. I never know what to do because it says the card isn't valid unless it is signed, and "see ID" isn't signed, but if they have their ID, my manager says go.

[jljamison]

12. PINs and Credit Cards

Only debit cards have PINs, primarily because the credit (e.g. signature-based) card infrastructure is not engineered to handle PINs. This means
a) there is no PIN captured at the time the card is issued and the card account does not have a PIN
b) the card swipe terminals and point of sale equipment does not require PIN capture for credit cards
c) the authorization networks are not built to require or check a PIN

Its kind of chicken and egg. To use PINs with credit cards, all of the millions of card swipe devices, cash registers, and point of sale systems would have to be upgraded all at once. All the banks would then have to upgrade their credit card account management software to securely capture & manage PINs. And they would have to bug their hundreds of millions of customers to securely submit a PIN, plus allow them to change their PIN when they forget it, etc.

The cost to the banks and credit card networks to do this is probably higher than the cost of fraud, or at least they continue to feel that they can deploy more cost effective anti fraud solutions based on the ever changing fraud landscape.

If you feel more comfortable using a PIN in card transactions, then by all means use a debit card exclusively.

As to some of the other questions about signatures and such, the simple answer is that the banks and card networks have agreed to allow certain levels of transactions without signature for certain types of merchandise. And in order to provide this convenience to the customer, they have agreements about which side of the transaction will "eat" the liability if fraud does occur (persons card is stolen and thief uses it to buy gasoline w/o a signature, for example).

More modern gas pumps, for example, require entry of the cardholder zip code. I suspect the gas merchants are able to have a higher maximum signature-less purchase amount if they do this, as it is just that much more likely the cardholder is the one using the card.

[porphyrian]

13. You bring up one of my pet peeves.

Having worked my share of shitty-paying-behind-the-register jobs, I find it reprehensible to place law enforcement duties on store clerks. Yeah, yeah, kids shouldn't be able to buy alcohol, and that's why stores ID people. They shouldn't be trying to buy alcohol either, but I guess you don't have to be personally responsible until you're 18. I don't really have a problem with carding people, but it doesn't stop there. Clerks are also expected to be able to spot fake IDs, counterfeit money, store theft and stolen credit cards, all for less money than any of the people requiring them to do so make. And, in the case of convenience store clerks (who are most often "tested" by law enforcement agencies to see if they'll sell cigarettes and alcohol to underage kids on their payroll who they provide with a fake ID - entrapment, anyone?), it's one of the top most dangerous jobs to hold in America while being one of the lowest paid.

Anyway, I just think it's bullshit to require minimum wage register jockeys to save giant corporate credit card and insurance companies a few bucks. If clerks are to be law enforcement officers, they should get guns and badges as well as hazard pay. If clerks are to be nannies, they should receive tax money from the community whose children they are to monitor. At any rate, clerks need to get paid more for enduring all the thankless customers most people become when buying shit.

</tangent>

[SemiCharmedQuark]

15. We're now also required to find fake "gift certificates"

You are too right...

[muriel_volestrangler]

14. I expect they will soon in the US

Much (maybe all?) of mainland Europe has used PINs with credit cards for years; the UK switched to them last year. The banks say it does save them on fraud. It uses a chip embedded in the card rather than the simple magnetic strip - are American cards issued with chips yet?

[benEzra]

16. Some do, but most don't. n/t