Visa Files Counterclaim to Wal-Mart In PIN Debit Card Lawsuit
June 29 2016 - 2:20PM
Dow Jones News
Visa Inc. fired back at Wal-Mart Stores Inc. in a legal dispute
over letting customers authorize a debit-card transaction with a
signature, saying that the retailer secretly configured its payment
terminals so only personal identification numbers, or PINs, could
be used.
The financial services company said it received complaints from
customers who could no longer use their debit cards at Wal-Mart
stores unless they had a PIN.
Visa said the move by Wal-Mart, which took place earlier this
year, violated the contract that the companies had negotiated in
which Visa told the retailer that customers must be given the
choice of using a signature.
"Indeed, at the time of (the contract's) execution, Wal-Mart had
already hatched a plan to eliminate the signature option at its
physical locations shortly after the effective date," Visa said in
the counterclaim filing Wednesday in New York state court.
Wal-Mart sued Visa over the issue in May, saying that PINs are
more secure than signatures. Visa requires retailers to let
customers choose how they want to authorize their debit-card
transactions.
In its filing, Visa said that it was never informed by Wal-Mart
that it had eliminated the signature choice. It said it only found
out about the move after noticing "a significant drop" in its debit
transactions at Wal-Mart stores.
Visa maintains control of the transaction with the signature
method, since merchants have the ability to route PIN transactions
through a non-Visa network. Visa's rules are different than those
of MasterCard Inc., which lets merchants decide how they want
customers to verify payments, according to people familiar with the
matter.
Write to Robin Sidel at robin.sidel@wsj.com
(END) Dow Jones Newswires
June 29, 2016 14:05 ET (18:05 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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