Most SMEs (Small and Medium Enterprises) will realise now that there is a huge demand for debit card machines, and since Chip and PIN technology emerged retailers without the appropriate card machines have lost out on vital business. The debit card is going to become the payment choice of the population very quickly and it’s happening already.
What has caused this?
This is pretty much due to its convenience and simplicity, but there are also other factors influencing the advancement of debit card payment processing at the moment. Not least among these things is of course the abolition of the cheque guarantee card and the pending abolition of the personal cheque. These things have forced those who would usually pay by cheque into seeking other options, and without the ready supply of cash, a debit card works perfectly since it is easier than a cheque and the funds are transferred from your bank account directly to the merchant in much less time.
Safety is another feature that attracts consumers to using debit cards, and credit cards too. It’s much easier and safer to carry a card and pay for goods and services rather than risk carrying large amounts of cash that could get stolen and not replaced. You could say that the same thing might happen with a debit card, however the debit card has many more measures in place to prevent its fraudulent use. Also, should your debit card be stolen and somehow used fraudulently, the banks have a system in place to refund the consumer for monies lost.
Low fraud risk
If you take your debit card out with you and purchase goods and services in card machines then all you need is your PIN number. Chip and PIN machines can offer the ultimate security because the customer can’t use the card unless they know the 4 digit PIN number; this is of course the same at cash machines. Web payments are a little different, but of course you still need to know the address of the card owner, their full name and any passwords that may exist due to the security feature Verified by Visa. This feature on Visa Debit cards has reduced online web payment fraud significantly.
What about contactless technology?
So what happens now that you have a card that is capable of going from shop to shop spending up to £10 on goods and services that doesn’t require a PIN number? There are issues here only really if you don’t realise you’ve lost your debit card or had it stolen. If this is the case then basically anyone could get hold of your card and go from retailer to retailer buying things. The only real deterrent to fraud with contactless technology at the moment is that occasionally a retailer may be required to do a full transaction with the Chip and PIN machine in order to verify the card users identity etc.
Summary
Either way, whether it’s with contactless debit cards or standard debit cards to use in Chip and PIN machines, the retail world, along with debit and credit card processing are moving towards a future where the use of plastic payments will be the normal thing to do.