MERCHANT NEWS At Sterling, our nAme iS our r e p u tAt i o n MAY, 2009 PIN Debit Has Advantages for Merchants and Consumers With PIN debit payments, electronic deposits are made to merchant accounts automatically, simplifying daily deposit reconciliation and improving cash flow. In many cases, interchange rates for PIN debit are lower than for credit card and signature debit cards. PIN (Personal Identification Number) Debit is one of the fastest growing methods of payment available today – and it’s emerging as a customer favorite. According to the annual Consumer Payments Usage Study by STAR (the electronic funds transfer network), 47 percent of consumers surveyed prefer paying with PIN debit, compared to 30 percent who prefer the signature debit method. Customers largely cited increased security as the number one reason for choosing to use PIN debit. PIN debit transactions require that the cardholder use a personal identification number. A PIN pad must be located at the POS for cardholders to enter their PIN to authenticate their identity and to authorize the transaction. A PIN debit transaction removes funds from the cardholder’s checking account almost immediately because the authorization and the settlement of the transaction is a “one step” process. The payment itself is processed over Electronic Funds Transfer (EFT) networks, which is the same way an ATM transaction is handled. STAR, NYCE and PULSE are all well known EFT networks. PIN Debit vs. Signature Debit Without the PIN, the cardholder’s identity is not authenticated although it is sometimes confirmed when a store associate requests a picture ID. In addition, a signature debit transaction is a “two step” process for authorization and settlement. This lengthens the time it takes for the merchant to be credited for the funds from the purchase. It also increases the opportunity for losses and chargebacks. continued >
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Merchant newsAt S t e r l i n g , o u r n A m e i S o u r r e p u tAt i o n
MAY, 2009
PIn Debit has advantages for Merchants and consumers
With PIN debit payments, electronic deposits are made to merchant accounts automatically, simplifying daily deposit reconciliation and improving cash flow. In many cases, interchange rates for PIN debit are lower than for credit card and signature debit cards.
PIN (Personal Identification Number) Debit is one of the fastest growing methods of payment available today – and it’s emerging as a customer favorite. According to the annual Consumer Payments Usage Study by STAR (the electronic funds transfer network), 47 percent of consumers surveyed prefer paying with PIN debit, compared to 30 percent who prefer the signature debit method. Customers largely cited increased security as the number one reason for choosing to use PIN debit.
PIN debit transactions require that the cardholder use a personal identification number. A PIN pad must be located at the POS for cardholders to enter their PIN to authenticate their identity and to authorize the transaction.
A PIN debit transaction removes funds from the cardholder’s checking account almost immediately because the authorization and the settlement of the transaction is a “one step” process. The payment itself is processed over Electronic Funds Transfer (EFT) networks, which is the same way an ATM transaction is handled. STAR, NYCE and PULSE are all well known EFT networks.
PIN Debit vs. Signature Debit
Without the PIN, the cardholder’s identity is not authenticated although it is sometimes confirmed when a store associate requests a picture ID. In addition, a signature debit transaction is a “two step” process for authorization and settlement. This lengthens the time it takes for the merchant to be credited for the funds from the purchase. It also increases the opportunity for losses and chargebacks.
•Convenience – Sterling merchant reports are available 24 hours a day, seven days a week via the Internet. The data in these reports is published to SNAP within ten minutes of becoming available to Sterling from Visa, MasterCard, American Express, Discover, and the ATM/Debit networks. With SNAP, merchants can view settled payment transactions without having to wait for monthly paper statements by mail.
•EasyAccess– SNAP provides a quick and easy way to access Sterling Merchant Services for support via e-mail.
•State-of-the-ArtSecurity– SNAP is a secure website protected by the latest encryption technology. SNAP provides secure account access with password- protected access and 128-bit encryption of all financial data. Additional security features include automatic timeout and card masking to protect sensitive credit card data.
•Print-FriendlyFormat– SNAP makes it easy to print or view reports online.
•Compatible Export – With SNAP, merchants can export files in a variety of formats that are compatible with a wide range of business software, including Quicken, Microsoft Money, Excel or ASCII text.
Getting Startedwith SNAP
In order for Sterling merchants to gain access to SNAP, they must first go through a three-step secure boarding process. To access the boarding system, go to: www.sterlingpayment.com/welcome.
If, during the boarding process you have questions, please call Sterling’s Merchant Services Department at 800-383-0561.
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Recent rule changes made by the card associations for specific merchant categories have eliminated the need for signatures on certain low-ticket purchases, which could provide another opportunity for increased fraud.
An increase in debit card use is good news for merchants. When consumers use their debit cards, they spend more. In fact, debit purchases are 32 percent higher compared to cash and 24 percent higher compared to checks. Grocery stores, gas stations and specialty retail locations are the most likely to benefit, as they are the most popular outlets for PIN-secured debit payments.
SNAP Provides Your Latest Processing Info in SecondsSNAP,orSterling’sNetworkAccessPortal,isaone-stoponlineresourceforSterlingmerchants.SNAPprovidesaconvenient,secure,fastanduser-friendly wayforSterlingmerchantstoaccessawiderangeofweb-basedreportingtools designed to help manage your processing account. With just a few clicks of your mouse,you’ll have a completeonline snapshot of all your processing data.
