As of: February 5, 2024, 4:00 p.m
By: Marco Blanco Ucles
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When paying by card, the merchant can require the consumer to either enter a PIN or a signature.
Which option is safer?
Since the Corona pandemic at the latest, most people have preferred cashless payment, and card payments are still on the rise.
This can be done with a debit or credit card as well as a smartphone.
Depending on the purchase, customers must complete the purchase by entering their PIN or with their signature.
Even if it often seems random which of the two variants consumers have to use, there is usually a system chosen by the dealers behind it.
Signature starts electronic direct debit process
First, it’s worth taking a look at the different payment models.
With the signature variant, an electronic direct debit procedure is started.
The customer gives the seller his consent to debit the amount from his account.
However, the booking does not take place in real time, explains the financial
portalzahlen.de
.
Of course, this leaves the seller with the risk that the customer's account will not have sufficient funds.
In addition, the customer could theoretically revoke the payment.
Card payments are becoming increasingly popular.
But is entering a PIN or a personal signature safer?
© MiS/IMAGO
However, if the customer has to enter their PIN, an electronic check will be made to see whether the account has sufficient funds.
If this is not the case, the card will be rejected - which is a much safer option for sellers and is now widely used.
Unlike the signature, there is no risk for the seller of being stuck with the costs.
In addition, it is much more difficult for criminals to find out the PIN of a stolen card than to simply forge their victim's signature.
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Payment with PIN: Dealers must pay part of the purchase price
But why don’t sellers only use the risk-free variant of PIN entry?
There is a simple reason for this: money.
With this form of payment, retailers have to pay 0.2 percent of the purchase price to the respective payment institution, which means additional costs arise.
That's why many retailers rely on a mixed system, sometimes requiring a signature, sometimes requiring a PIN entry.
With contactless payment, which is increasingly used and where Germany lags behind in the international arena, up to a certain amount - usually 50 euros - neither a signature nor a PIN is necessary.
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What determines whether customers have to sign or enter their PIN in a store cannot always be proven.
“In many stores, a random system decides how shoppers have to verify payment for their purchase,” writes the
techbook
portal .
In some stores, however, the seller can also decide - depending on the purchase amount, for example - how the card payment is processed.