Walmart Sues Visa to Require PINs for Chip-Enabled Debit Cards

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Walmart is suing Visa in order to require customers with chip-enabled debit cards authorize their transactions with a PIN instead of a signature.

In a lawsuit filed Tuesday in New York Supreme Court, Walmart claims Visa is forcing the retailer to allow chip-using customers to use signatures, even though signatures are essentially “worthless as a form of authentication.”

According to the The New York Times, a Walmart spokesman said in a statement:

This suit is about protecting our customers’ bank accounts when they use their debit cards at Wal-Mart. We have long advocated for ‘PIN verification’ as opposed to the less secure signature verification for debit transactions. PIN is the only truly secure form of cardholder verification in the marketplace today, and it offers superior security to our customers.

Currently, Walmart customers with chip-enabled cards are asked to use a PIN at checkout, but they have the option to use a signature instead. Walmart is hoping to make these transactions safer by standardizing PIN use, since it claims 91 percent of fraudulent debit card purchases are authorized with signatures.

Chip cards were developed as a safer alternative to standard magnetic strips. These cards are able to encrypt and authenticate data for each transaction, rather than simply recite your credit card number and expiration date to any machine.

Retailers were required in October to install chip-reading terminals into their stores, or face the threat of being liable for fraudulent transactions. Prior to the deadline, banks were on the hook for these charges.

Walmart spokesman Randy Hargrove continued,

Visa has acknowledged in many other countries that chip-and-pin offer greater security. Visa nevertheless has demanded that we allow fraud-prone signature verification for debit transactions in our U.S. stores because Visa stands to make more money processing those transactions.

Visa has not released a statement yet addressing these allegations, but more information is likely to come out as the story develops.

Alexis Evans
Alexis Evans is an Assistant Editor at Law Street and a Buckeye State native. She has a Bachelor’s Degree in Journalism and a minor in Business from Ohio University. Contact Alexis at



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