Best Buy becomes contactless-less
(15 January 2010 – USA) A major United States retailer, Best Buy, has withdrawn the acceptance of Visa’s payWave contactless technology at its 1023 stores nationwide in protest to the card giant’s fee structure.
In August 2007, Best Buy implemented Visa payWave into some of its store before proceeding to roll out the technology nationwide by April 2008.
The retailer became upset at Visa’s prohibition against allowing a PIN to be used with a Visa contactless debit card. The controversy is linked to the fact that forcing merchants to accept signature authorisation only pushes, the transactions into a much higher interchange rate.
The card giant’s competitor, MasterCard, has no such restrictions on its contactless cards.
In July last year Best Buy threatened to withdraw its acceptance of Visa payWave if Visa did not change the fee structure.
The retailer issued a statement on July 16, 2009, saying that Best Buy is constantly looking at ways to reduce the cost of the check lane tender. As part of this exercise the continued acceptance of Visa-issued contactless payment cards is being evaluated in light of recent price increases.
An executive involved in the decision said that after several discussions with Visa there have been no agreeable changes. By October the chain had started the removal of its acceptance of Visa contactless cards and completed the cut-off in November along with POS upgrades.
The executive also added that the US$35 billion (A$38.02 billion) chain’s decision was based on the costs associated with requiring contactless debit transactions be processed as signature debit.
The retailer became upset at Visa’s prohibition against allowing a PIN to be used with a Visa contactless debit card. The controversy is linked to the fact that forcing merchants to accept signature authorisation only pushes, the transactions into a much higher interchange rate.
The card giant’s competitor, MasterCard, has no such restrictions on its contactless cards.
In July last year Best Buy threatened to withdraw its acceptance of Visa payWave if Visa did not change the fee structure.
The retailer issued a statement on July 16, 2009, saying that Best Buy is constantly looking at ways to reduce the cost of the check lane tender. As part of this exercise the continued acceptance of Visa-issued contactless payment cards is being evaluated in light of recent price increases.
An executive involved in the decision said that after several discussions with Visa there have been no agreeable changes. By October the chain had started the removal of its acceptance of Visa contactless cards and completed the cut-off in November along with POS upgrades.
The executive also added that the US$35 billion (A$38.02 billion) chain’s decision was based on the costs associated with requiring contactless debit transactions be processed as signature debit.
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