July 8, 2014
Written by
James Davis
Written by James Davis
Senior Technical Writer at United Thinkers

Author of the Paylosophy blog, a veteran writer, and a stock analyst with extensive knowledge and experience in the financial services industry that allows me to cover the latest payment industry news, developments, and insights. Read more

Reviewed by
Kathrine Pensatori
Product Specialist at United Thinkers

Product specialist with more than 10 years of experience in the Payment Processing Industry. I help payment facilitators and PSPs solve their various payment processing issues. Read more

Integration With PINless Debit Card Networks

Integration with PINless debit card networks has several advantages over integrations with regular card networks maintained by Visa and MasterCard.

The first advantage is that there is no concept of chargebacks in PINless debit card networks. If the money is charged, the charge cannot be reversed. It means that merchants, whose chargeback rates are high, are interested in integrating with PINless debit card networks. By doing that they decrease their chargeback rates in two ways. Firstly, they completely avoid chargebacks on PINless debit card transactions. Secondly, by integrating with PINless debit card networks, they reduce the percentage of transactions processed through regular card networks, which can, potentially, result in chargebacks.

The second advantage of PINless debit card network integration is that there are no processing delays involved, while during processing through regular card networks money transfer take several days.

Last Advantage PINless Debit Card Networks

The third advantage is lower interchange rates, charged from merchants for transaction processing through PINless debit card networks. After passing of the so-called Durbin Amendment, regular Visa and MasterCard networks were forced to decrease their interchange rates, so potential benefit from transaction processing through #PINless #debitcardnetworks are no longer measured in per cents, but in basis points. Still, on large transaction processing volumes even several basis points provide an incentive for merchants, so large-size merchants still need to keep the advantage in mind.

What is a pinless debit card? More detailed information on PINless debit card network integration can be found on Paylosophy.com blog.

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