April 4, 2004
“Debit cards linked to personal identification numbers are slowly but surely penetrating more and more merchant locations, and as a result PIN debit transactions will begin to overtake transactions on signature-based debit cards within five years, says an analyst at Speer & Associates Inc., Atlanta, who has studied the issue. For years, says Ali Raza, vice president at Speer, merchants resisted PIN debit because of the cost of the point-of-sale PIN pads necessary to process transactions, but the devices have steadily dropped in price and now range between $100 and $150. The devices are still rare among small retailers and in certain merchant categories, such as hotels and restaurants, but they are beginning to migrate down the retailing ranks from large supermarket chains, which were among the first to deploy them “Mid-tier merchants have started to install them,” says Raza. He figures anywhere from 25% to 30% of all U.S. merchant locations are now equipped with PIN pads, up from 20% a year ago.
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