Do I Need to Accept PIN Debit?

This is a significant question for retail merchants nowadays. Many wonder, “Should I accept PIN debit?” Traditionally, the answer was based on various factors, mainly cost differences and time saved using PIN entry. However, with the introduction of EMV technology and regulations, PIN entry is increasingly becoming the safest form of in-person payment acceptance. Therefore, Allied Payments strongly recommends buying PIN-enabled hardware, so you’re ready when Chip+PIN technology becomes popular.

What's the Difference Between Chip+PIN and Chip+Signature?

In October 2015, new regulations required merchants to start accepting new chip cards, known as EMV cards. EMV cards come in two versions: Chip and PIN and Chip and Signature. As expected, they have different authentication methods at the point of sale—either a 4-digit PIN entered by the customer or a signature on a receipt or tablet screen. An issuing bank can choose to issue a card with or without a PIN. Chip+PIN is the most secure method because it is harder to steal a PIN than to forge a signature. Currently, most US banks issue Chip+Signature cards, but they will gradually shift to Chip+PIN.

As a Merchant, You Have Two Choices:

1. Accept Chip+PIN. This is the safest method because it allows both Chip+PIN and the default Chip+Signature.

2. Only accept Chip+Signature. This exposes you to some liability. Chip+PIN cards are not yet widely adopted, and if you accept a Chip+PIN card fraudulently, you won’t stop the fraud with just a signature. Therefore, you would be liable for the chargeback.

Chip+PIN Hardware

To accept Chip+PIN, merchants need a terminal with either an internal encrypted PINpad or an external customer-facing PINpad for debit card PIN entry. External PINpads incur an additional cost as they are extra hardware. Internal terminal encryption requires physical encryption, and Allied Payments must sell the terminal pre-encrypted. Otherwise, you cannot accept PIN debit. If you choose to use your terminal’s internal PINpad, you’ll need to manually move the terminal to let the customer enter their PIN. Thus, merchants with long lines might require an external PINpad.

Allied Payments offers various Chip+PIN hardware options. Purchasing any Allied Payments terminal ensures it is encrypted with the right keys for future Chip+PIN acceptance. This means Allied Payments merchants will be prepared when other terminals adopt Chip+PIN in the future.

What is PIN Bypass, and Why is it Important for Restaurants?

For restaurants that need to accept tips, PIN Bypass is crucial. With a Chip+PIN card, you can’t add a tip afterward if it was processed with a PIN. This means that you’ll need to process it as Chip+Signature.