19 ms·

Ask HN: Why are credit card chip readers so slow?

• cdibona 9y ago
  Do you mean the actual chip back and fourth? The inherent problem is that the 7816-d standard is a mess. It requires extremely small data exchanges on the order of seconds to get a cert out of the card. This has been a mess since the mid 90s, when I first worked on these things. Here a cruddy not at all usefule link to the standard: http://www.cardwerk.com/smartcards/smartcard_standard_ISO7816-4_annex-d.aspx http://www.cardwerk.com/smartcards/smartcard_standard_ISO781...
• Mandatum 9y ago
  Bad internet speeds, WiFi or business skimping on internet. It's never usually the terminal, it's the connection to their payment provider, or their payment provider reseller's connection to THEIR payment provider. It's very common for bars and restaurants to have a dedicated line for the terminal, but usually they'll skimp on tech (have seen dial-up over POTS or in a fibre-capable premises). Also very common to use 3G or 2.5G. It'd take a tech all of 5 minutes to diagnose and suggest a fix for 98% of these slow terminals. It's strange seeing businesses not look to fix these issues. If I was a payment provider I'd probably run diagnostics against my customers terminals every day and force poor performing customers to have someone come in and fix it.
  • droopyEyelids 9y ago
    Your conjecture doesn't address why the swipe is fast while the chip is slow.
    • mschuster91 9y ago
      It certainly does. Swipes are settled (transmitted to the bank) once a day, after store closure. The chip, meanwhile, is in almost all cases online - which means that when the terminal is connected via POTS or ISDN, there is a minimum delay of 10-30s for establishing the connection, while this is nearly instant with a DSL/fiber uplink.
      • Mandatum 9y ago
        This. Sorry, I thought this was a given. Thanks for filling in the blanks mschuster91.
        • phil21 9y ago
          This is not remotely common in the US. Almost all transactions are on-line, issuing an auth against the card. You are correct that end of the day batches then happen to settle all those auths into actual sales - but that's so you can do things like instantly refund a customer for a cashier fuckup/etc. and not get charged the discount fee both ways like how a regular refund works. There are no stores simply accepting any/all magnetic swipe transactions and then only at the end of the day figuring out that oops, that card didn't have enough credit available after all.
      • redbluff 9y ago
        Not true - the entry mode is irrelevant to whether it is batched or online. In fact it is more likely in modern systems to be the other way around. Chip may use offline, including offline PIN, whereas stripe is nearly always online. Source: 30 years EFT Banking experience, specialising in EMV.
• richardknop 9y ago
  In Europe processing cards with chip & PIN at POS is quite fast. It usually takes 2-3 seconds for me before "Approved" appears on the reader screen. This might have something to do with US retailers still running legacy POS terminals / tech.
  • rhodysurf 9y ago
    A lot of terminals are that fast but even a few seconds feels like forever compared with swiping and it going through instantaneously.
    • richardknop 9y ago
      Yes. All my EU bank cards also support contactless payment. But there is a limit over which you have to enter PIN to approve transaction. But small purchases like coffee at Starbucks I just touch my card with the card reader and it instantly approves. Taking money from ATM always requires PIN though.
      • andypants 9y ago
        I think rhodysurf means swiping the magentic strip on the back of the card, not contactless payment.
        • rhodysurf 9y ago
          I pay with my watch or phone when i can actually because that is faster than both swiping or putting the chip in. But yes, my original comment was talking about swiping the card using the mag strip.
          • richardknop 9y ago
            Ah I see. Yes we don't swipe mag strip in Europe. The only time somebody asked me to swipe my card was on my vacation in Asia. That was first time I needed to do that and they also asked for my signature which surprised me as it was first time in my life I needed to sign a receipt! I also use Apple Pay sometimes but these days I mostly default to contactless payments as the prepaid debit card I use for small purchases is connected to a mobile app on my phone where I can track my spending and get instance push notifications
• Figs 9y ago
  I don't know what the reason actually is, but I assumed it was slow by design to make it harder to compromise, similar to bcrypt.
• bericjones 9y ago
  Because with the swipe readers there is only one call to the payment processor. However, with chip transactions there are multiple calls for different payment processing flows. For example, a transaction could require 5 round trip request responses from the chip to the payment process meaning 5x the time required.
  • bosky101 9y ago
    +1. Not to mention each party will have their own VPN's so internal hops to the right machines. That said - these days even swipe reads have multiple payment processing flows especially for co-branded cards.
  • maaaats 9y ago
    Next question then becomes why it needs those additional trips? Authorization is already done on the chip, it should only need to verify the amount is available.
  • fdavison 9y ago
    Plus your card is half-way back to your wallet before the first call is even made when you swipe it, but with the chip, you can't retrieve your card from the machine until the transaction is done. Even if the transaction took exactly the same amount of time, the chip method takes longer because your execution thread is blocked waiting for a resource to be released.
  • tdeck 9y ago
    A more interesting question for me is: why are NFC credit cards so much faster than chip ones? Presumably they require the same kind of round trip challenge-response with their internal chip, but I have heard they're much faster.
    • compsciphd 9y ago
      AFAIK (please correct me if I'm wrong) NFC is more akin to magnetic strip than chip cards are. i.e. a virtual number is created for each transaction that is tied to the merchant / time of use. so, you get an id from the merchant (i.e. direct communication between you and reader) you get a virtual number from you credit card provider (1 internet trip), and you give that virtual number to the reader), then phone is back in pocket while it does its thing. Samsung pay even cuts out any knowledge of the reader, just gives a virtual number to the credit card mag reader.
• sgustard 9y ago
  https://en.wikipedia.org/wiki/EMV#Transaction_flow https://en.wikipedia.org/wiki/EMV#Transaction_flow
• ca12et 9y ago
  Additional question: why is it faster in other countries? The first time I used a chip card in the US I was astounded by how long it took. I had been using chip (and pin) cards in Canada for years and it was never as slow as it is in the states.
  • laurentoget 9y ago
    Same impression here. I lived in France when chips were adopted 30 years or so years ago and i do not remember them being slower than the stripe version.
    • sverhagen 9y ago
      These are completely different (mostly national) systems, evidently optimized for different things. For example, in the Netherlands there is still plenty of retailers that don't even accept EMV cards (there is only a small number of (mostly foreign) visitors that'd be interested in such transactions, also the costs of supporting these are typically higher than just supporting the national system).
    • hocuspocus 9y ago
      Try to pay with a foreign card in France and you'll see it can be pretty slow. Chips were introduced in France at a time where connecting all terminals wasn't practical/cheap. For this historical reason, most payment terminals aren't processing the transaction online in presence of a domestic card, even if they can. Offline transactions are very quick.
      • shawnz 9y ago
        So if offline transactions are viable, and faster, then why doesn't the US use them?
        • kalleboo 9y ago
          They were viable 30 years ago, maybe not today
• userbinator 9y ago
  Smart cards (ISO 7816), used for credit cards and SIMs, among other things, communicate through a relatively low-speed serial protocol. The secure microcontroller they contain is also quite slow, especially if you consider the cryptographic operations they're required to perform. I suspect part of it is due to power constraints, and also somewhat tamper resistance.
  • teilo 9y ago
    Line speed has nothing to do with it. The speed of the transmission from card to reader is dwarfed by the latency of the transaction as a whole.
• exabrial 9y ago
  And why on earth do you have to SIGN still? Seriously. I draw a picture of Shammoo most of the time, to the delight of many cashiers
  • peteretep 9y ago
    Generally I just circle the part of the receipt that says "No signature necessary"
  • lysp 9y ago
    In August 2014, the whole of Australia switched from signature based to chip and PIN. I'm guessing a lot of other countries have followed too.
    • Humphrey 9y ago
      Yeah, I was pretty confused by the "signing" thing in the usa! I figured they'd have ditched signing, but instead, they created complicated digital signing machines! :-o
    • rsynnott 9y ago
      A lot of other countries have lead, really; Australia was very late in doing this. It was in France in the 90s, of course, and showed up in most of Europe by the mid-noughties.
  • austenallred 9y ago
    Signing is mostly so that you can't file a chargeback saying you didn't mean to buy, not so much to show that you are the verified cardholder.
    • function_seven 9y ago
      I don't follow. How does me scribbling a line affect my ability to fraudulently claim it wasn't me who used the card? Especially when the back of the card has my signature on it as well?
• _wmd 9y ago
  Note this isn't true in all countries. My UK cards within the UK all follow some apparently online process in any UK merchant, however during a stint in Finland a few years back, I didn't find a single example of a merchant where their reader didn't instantly approve my transaction as soon as I correctly entered my pin. Never received a (note: I know, we can all make guesses) conclusive answer explaining the difference.
  • PeterisP 9y ago
    There's no technical reason for the difference, simply it's up to the merchant & issuer that can arbitrarily set all kinds of limits where certain checks will be required. It's a tradeoff between convenience and security, different places will make different choices, but generally competitors within a single market (e.g. UK or Finland) will try to make the same choices so they don't get customers asking why they're slower than a competitor.
• phlo 9y ago
  As has already been pointed out, EMV transaction flows go through many steps. From what I understand, the protocol was designed with a focus on flexibility, and little attention was paid to low latency. Until some years ago, most terminals would mirror that. Most prominently, they used to have separate "enter pin" and "verify transaction amount" steps, and included longer delays for displayed status codes. Recent devices have started combining these steps ("Amount: xy. Enter PIN to confirm") and status messages. Newer use-cases like the contactless qVDSC application have been tuned for better performance, limiting the amount of communication between reader and card. For more details, have a look at this guide from VISA: https://www.visa.com/chip/merchants/grow-your-business/payment-technologies/credit-card-chip/docs/visa-emv-merchant-tadg.pdf https://www.visa.com/chip/merchants/grow-your-business/payme...
  • Symbiote 9y ago
    That would make sense if the USA was an early adopter, but it's the latest adopter. They should have jumped straight to the latest systems. Also, I don't remember EMV being slow in the UK, and that was an early adopter of the modern protocol (2004).
    • cbhl 9y ago
      The USA was an early adopter of Point of Sale systems. I'm under the impression that retailers haven't upgraded the computer systems attached to credit card chip readers.
      • zeta0134 9y ago
        Aye, in South Texas at least, I've noticed that newer terminal systems seem to process things just as fast as card swipes, if not more so. But older systems that have obviously been retrofitted with the technology are hit and miss. I often feel like it's the user interface slowing things down more than the transaction itself though, I can't recall any recent instances of delays waiting on the authorization to happen that were longer than a few seconds.
      • VLM 9y ago
• toast42 9y ago
  Planet Money did a story on this last year. http://www.npr.org/sections/money/2016/04/13/474135422/episode-695-put-a-chip-on-it http://www.npr.org/sections/money/2016/04/13/474135422/episo...
• callumjones 9y ago
  I believe Index was working on speeding up EMV transactions: http://www.index.com/payments-and-security/emv/ http://www.index.com/payments-and-security/emv/ I thought it now depends on the firmware in the card readers, which it seems companies like Index control.
• asciimo 9y ago
  There's an express Target in the San Francisco Financial District that gets around this by assigning cashiers to two registers. They start the chip payment transaction on one register, and the slide over to the second register to start another customer's checkout. Then they slide back to hand the receipt to the first customer, etc. Absurd but effective.
  • ben_jones 9y ago
    Similarly Starbucks employees will initiate a transaction then step away to prepare the order then come back and finish up.
  • germanier 9y ago
    In Germany, Aldi Süd uses a similar method. While the customer inserts the card and enters the PIN (which is the slow part – the machine itself is really fast) the cashier starts scanning the items of the next customer. All this happens with the same register so the switch happens in software (they invest a lot in register technology).
    • mediascreen 9y ago
      In Sweden people usually start the slow part (entering the pin) while their items are scanned. When all items are scanned you just press ok to authorise the amount and wait for 1-2 seconds for the transaction to go through.
      • germanier 9y ago
        Ah yes. I have written about this on HN before. I have never seen this outside Sweden für some reason. At Aldi specifically it wouldn't be useful as you have to keep up with the cashier's scanning speed while bagging. In other stores you can start bagging at the end. Not sure why they don't use the same idea as Swedish stores. Once I tried inserting my card while scanning in a German store but the machine didn't like it at all.
        • 9y ago
• randomfool 9y ago
  FWIW, Square's chip reader seems to be much faster than many others.
  • photojosh 9y ago
    Can confirm. Just set a Square reader up for my local school's parents' association and it's so quick I had to do a double-take as to whether the payment actually had been made.
  • bpicolo 9y ago
    I've noticed this too. It's blazing compared to the average Verisign
• Humphrey 9y ago
  This post explains why I was so frustrated using my card in the USA the other month. I figured it was super-slow because I had an international card, and it was confused. Back here in Australia, almost every retailer (including those on 3g eftpos machines) takes < 4s from when i tap my card, to when I can start walking away. So much quicker than cash :-)
  • noway421 9y ago
    4s is outrageous, paywave works within 1s.
    • vacri 9y ago
      You haven't used a myki machine, clearly! (myki is the horrible Melbourne version of the Oyster card. a bungled project from start to finish)
    • SyneRyder 9y ago
      Depends on network situations. Here in Perth I'll get a beep immediately on Paywave, but still have to wait a few seconds for Payment Approved to appear on the screen. Some stores seem to have really terrible mobile reception for their mobile payment terminals. Still faster than Bitcoin confirmations though.
• pbreit 9y ago
  Previously the mag-stripe conducted your card number to the merchant and they could charge essentially whatever they wanted (but there were various reasons they would likely charge the amount you owed). With chip, they have to compute the final amount while your card is inserted and cannot deviate.
  • camiller 9y ago
    Place I part time at the card terminal isn't even hooked into the cash register. I have to manually enter the amount from the register screen into the card terminal. But I have to do that for mag stripe and contactless as well.
• vasusen 9y ago
  Here's a good blog post from a WePay engineer that explains some of the slowness - https://wecode.wepay.com/posts/supporting-chip-cards-at-wepay https://wecode.wepay.com/posts/supporting-chip-cards-at-wepa...
  • coleca 9y ago
    Great post. Now I finally learned why when I use my debit card I'm asked "INTL VISA" or "US DEBIT BANK" every time. I thought it was the PIN pad software, it's actually an app running on my own card that is causing that to come up with every transaction.
• sofaofthedamned 9y ago
  I was a user in the Mondex card trial in 1995. This was like modern chip cards, but a stored wallet instead of online auth to an account: https://en.wikipedia.org/wiki/Mondex https://en.wikipedia.org/wiki/Mondex The banks outfitted buses, bars, pretty much everywhere with readers but even after inducements to use it such as half price beer(!) it still failed. Why? Because it was soooo slow. Waiting for ~45 seconds at the bar for a payment to go through got old really fast. It barely lasted a year. I'd have thought the friction of the payment would have been a lesson learned, but here we are 22 years later and it's still a pain.
  • cat199 9y ago
    Yet now, in the card dominated era, we routinely split checks into 10 parts when dining in a group because people don't carry enough cash..
    • ghaff 9y ago
      Although a lot of restaurants have notices to the effect that they'll only split bills up to 2 ways or something along those lines. I don't use cash a lot but it's still a good idea to carry some.
  • jandrese 9y ago
    45 seconds is a ridiculous amount of time. I wouldn't use it either. It would put a big bite in a cashiers items per minute figure too, so they would hate it.
    • sofaofthedamned 9y ago
      It was even worse on public transport apparently. I can't even imagine being there for 45 seconds in front of a load of angry old ladies trying to get on.
• ronpeled 9y ago
  just another reason we'll move faster into blockchain and decentralized crypto currencies...
  • Dylan16807 9y ago
    So we can increase the latency to confirmation by orders of magnitude...? Chip readers are a couple seconds with a good setup, and a couple minutes with a bad setup. Blockchains drag that into minutes and hours.
• tomerbd 9y ago
  could it be on purpose? to have it more secure? like, wait before you can retry?
  • mkagenius 9y ago
    no :) but good idea.
• jimjimjim 9y ago
  The workflow can be quite quite complicated. card<->reader<->pc/terminal<->transport (ip/phone line/gprs)<->financial switch<->financial institution. Add to that emv, tripledes etc and it all adds up.
• jimjimjim 9y ago
  also, other countries have completely switched over to chip/pin for security reasons with little or no problems but due to not wanting to confuse US tourists the terminal software must allow pin-bypass so they can still sign instead of using a pin. sigh.
  • TulliusCicero 9y ago
    It's not due to not wanting to confuse US tourists, it's wanting to accommodate US tourists; American credit cards don't have a PIN, period.
    • jimjimjim 9y ago
      my bad, it's been years since i last worked in that field. And I just remember sighing a lot at all the hoops that had to be jumped through in the name of security and then to just allow people to bypass it.
• sds111 9y ago
  I draw a Kilroy. \|||/ (o o) ----(_)----
  • sctb 9y ago
    Please don't post like this here. https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html
• YeGoblynQueenne 9y ago
  Edit: this is not entirely correct; transactions may go online or stay offline, depending on amount and connection speed. See comments below. It might depend on where you are. Where I am, in the UK, chip card transactions are quite fast. Fast enough to use contactless (tap and go a.k.a. "pay by bonk") where you literally just tap your card on the pinpad and go on your merry way [1]. The difference is that in the UK, transactions are not immediately sent online. I repeat: they're not immediately sent online. So you don't have to wait for the merchant to contact the acquirer, for the acquirer to respond and so on and so forth. Instead what happens is that you dip, or swipe, or tap your card; the pinpad and the card figure it out between themselves whether you are the rightful owner of the card; the pinpad makes a record of the transaction; and you're told the transaction is "approved", then pick up your goods and go home. Later in the day, the merchant (i.e. an automated process at the store) sends an overnight "batch" of transactions to the acquirer, (i.e. the bank or credit network etc) and the acquirer either transfers the funds directly to the merchant, or blocks out the funds so you can't use them again and they can be transferred to the merchant later. That's the EMV standard in a nutshell and entirely from memory, with a distance of a good few years from the time I worked for an EMV vendor (we sold a bit of EMV software that went on the Point-Of-Sale machine and handled all of the above). I might be misremembering a few things but I believe the above is mostly accurate. tl;dr: having to go online for each and every transaction takes forever. ___________ [1] Or of course sometimes do a double take, realise the transaction hasn't gone through, tap again, eyball the pinpad, then possibly insert or swipe etc. Sometimes it doesn't work.
  • gambiting 9y ago
    Uhmmm I'm fairly certain that's not entirely correct. There may be terminals which batch transactions and send them later, but in most cases you can even see the terminal going "connecting to <bank> servers" and only after it obtains the connection it authorizes the transaction. Larger stores have a constant connection open so the transaction goes through straight away, in smaller shops the terminal actually has to connect with the bank first. But I guess the best proof is that if you have zero money in your account you can't actually buy anything with your card, the transaction will get declined immediately(unless you have overdraft, obviously), so the terminal has to check with the bank if you have funds to pay or not.
• Tepix 9y ago
  Here is Germany it usually takes a few seconds (less than 5 I'd say) - I noticed however that paying at Aldi Nord is very fast. They really do tweak the cash register speeds at Aldi...
  • aembleton 9y ago
    Interestingly, Monzo takes a few seconds (~5) to notify me of a transaction if I do it in Germany. UK, Belgium, Malaysia and Indonesia are all instant. I assumed that there must be some further process that it goes through, between telling the credit card reader that it is completed and Monzo getting informed.
    • SpeakMouthWords 9y ago
      I wouldn't muddy the waters here with talk of Monzo. Most chip reader cards don't do what Monzo does in terms of real-time backend transaction verification, that's a generation further than the stuff being rolled out in the US.
    • maccard 9y ago
      Monzo tends to notify me before the card reader has actually registered the payment in the UK
    • danpalmer 9y ago
      Correct. Cards can indicate whether they need to be verified online or not. Most do not require this (so transactions are just recorded and processed some time later), apart from Visa Electron which was designed for under 18s, and therefore does not have an overdraft, so requires an online balance check. Monzo take advantage of this to enable their realtime notifications and related features, otherwise Monzo would receive the notification of the charge up to 48 hours later which would be a significant harm to the UX.
  • mschuster91 9y ago
    Yeah because Aldi entered the play only very recently and so used top-of-the-line CC readers only, plus always a solid DSL link. Old stores, especially small mom-and-pop ones, are still stuck with readers built a decade ago, or with modern readers uplinked by POTS. I recently helped my vet switch from an old POTS terminal to a brand-new, DSL-linked one; the speed difference is huge.
• arethuza 9y ago
  Here in the UK I'm generally amazed at how fast they are - slowest part is typing my PIN in if that is required (some places still require it or if the transaction size is over the limit for contact-less).
  • pfranz 9y ago
    I'm guessing the OP is from the U.S. A few notable differences in the U.S.: they've only been rolling it out for a few years and they use a signature instead of a PIN. This is a suspicion, but I think they're slower in the U.S. because a) they're just slower b) the UX is worse. You insert the card, wait, then it asks for a signature (presumably because not all accounts, vendors, and dollar amounts require a signature?). From what I've seen overseas you insert the card, type in your PIN (in parallel to card processing)--so it appears to process more quickly because you're not waiting.
    • tokenizerrr 9y ago
      Huh? How does the signature thing work? Do you input your signature into your signature into the device somehow?
      • bodyloss 9y ago
        I believe you give a physical signature and its compared to what's on the back of the card.
        • pluma 9y ago
          Most likely this. I'm not sure why card readers in Germany don't ask for the PIN every time but when they don't you're generally asked to sign the cashier's copy of the receipt and they'll verify the signature against what's on the card. However not only will the cashier generally let you simply put the card next to the receipt while you sign (because this makes verification easier for them) but it doesn't seem like they actually apply any scrutiny: the signature on my card is very different from the one I use for signing these days and it never raised an eyebrow. FWIW, I've signed for card transactions in all kinds of places across Germany, from small shops to large hotels. I can't figure out what triggers the decision between PIN and signature but I swear I've used either in the same place at different times for equivalent amounts.
• andy_ppp 9y ago
  I mean worldwide Monzo (UK challenger bank) get's a buzz in my pocket from their app in < 5 seconds to say accepted/declined.
• welanes 9y ago
  This guide from N26 bank is informative: https://n26.com/how-realtime-notifications-work/ https://n26.com/how-realtime-notifications-work/ Each time you use your card for a payment (which is almost instant), you receive a realtime notification within 0.5 seconds.
  • tzaman 9y ago
    I use N26 as my personal bank, and I must say it's pretty much instantaneous - when I pay contactless, I can hear my phone notification before I get to put the card back in the wallet. I've tested the card across Europe while traveling and the speed at which I get push notifications is consistently fast.
    • Moter8 9y ago
      Can confirm, phone vibrates before the POS beeps.
• Beltiras 9y ago
  It seems to differ between implementation. In Iceland the readers have usually been superfast. We just had a Costco open and the readers there are superslow. Goes through multiple handshakes and notifies you of the process. They might be hooked up to a different payment processor than the local ones, hence higher latency.
  • firebird84 9y ago
    That's odd. My costco recently switched to using chip readers and they are SUPER fast. They're the fastest I've ever seen. I can't imagine there's any way they're contacting a host at all...
• the_mitsuhiko 9y ago
  I can't talk about the US but over here (Austria) the slow chip readers typically are GRPS based and connect for every single transaction. There is one nearby in a lunch place where I really consider telling them how to hook it up with their wifi :)
  • codfrantic 9y ago
    I recently helped a shop connect their terminal to the wired connection instead of the POTS one. The time it takes for a payment to go through went from 25 seconds to 2 seconds :) Also they used to pay a few cents for each transaction...
• nstj 9y ago
  You might want to qualify this with “in the US” as chip+pin cards are pretty fast in other countries by comparison. Also there was a great episode of the podcast “Planet Money” a while back which goes into detail on your question [0]: > Today on the show, we bring you a brief history of what's in your pocket. It's a story of convenience vs. fraud—and it also includes a hippie inventor, the origin of the last great upgrade on your card, the magnetic stripe, and why it takes so long to "dip the chip." [0]: http://www.npr.org/sections/money/2016/04/13/474135422/episode-695-put-a-chip-on-it http://www.npr.org/sections/money/2016/04/13/474135422/episo...
  • dv35z 9y ago
    Thanks! And correct - should have added "in the US" in te title. Just got back from a trip, and am always reminded how archaic USA banking feels compared to most other countries' systems. With the recent industry switch to chip in the US, I'd hope transactions would be faster and easiee - but the implementation seems terrible: confusing POS interfaces, slow chip reading, still need to sign / no PIN, rarely any "bring the mobile POS to your restaurant table" requires still waiting on the waiter for 5min, etc.
    • muninn_ 9y ago
      Sure. And that's one of the problems with being first to infrastructure. It's really hard to just "change it all" once something new and better takes hold. It'll get better, even if it's not that great right now. Though, I largely take issue with your statement that U.S. banking feels archaic. I'd say U.S. banking is, if nothing else, generally at the forefront of digital technology despite heavy regulation. (I'm not arguing regulation bad/good, but it is a fact that the industry is heavily regulated).
      • CaptainZapp 9y ago
        I'd say U.S. banking is, if nothing else, generally at the forefront of digital technology despite heavy regulation I wouldn't call checks, which are still widely used in the US the forefront of digital technolgy. I think it must have been more than 10 years ago since I've seen my last check and that was an Amex Traveller Cheque
• Confusion 9y ago
  I have no idea what you consider slow, but the latest improvement here is contactless payments for anything under 25 EUR, which only requires holding the card close to the terminal for about a second. After which the payment is confirmed after another second. Payments for which a PIN is needed are confirmed in the same amount of time and entering the PIN is the slowest part.
  • camiller 9y ago
    Most cards issued in the US are not contactless, so the only contactless transaction are I-pay/Android/Samsung-pay.
• cozzyd 9y ago
  All I can say is it was very slow at the McMurdo gift shop
• leejo 9y ago
  I suspect it's because a lot of merchants are using terminals that are connecting over PSTN, or they don't hold a connection open between transactions so they have to do the connection dance for every transaction. Or they have connections that are just plain slow. From my time writing backend banking integrations for a PSP, going on 5 years ago now, the time to authorise a card transaction (that's IP to BT gateway to X.25 network to acquiring bank to issuing bank and back again) would take anything between 0.2 and 1.0 seconds. So I don't believe it's actually down to any complexity in the authorisation steps if the transactions are done online.
  • coleca 9y ago
    I see the same behavior in large chain stores such as Target, Lowes, and Walmart that would have dedicated private lines between the stores, their datacenter(s) and the banks. I've worked at a few large retailers and they typically had a hub and spoke model of network where all the stores would communicate over a private MPLS network to the datacenter where we had a "payment switch" (also called a payment gateway or router) dedicated individual redundant T3 lines to each card network (Amex, Discover, Mastercard/Visa, EBT, and gift card processors). This was at a chain with 200 stores. Larger chains would be even more robust I would imagine. I think the delays aren't network related, but more along the lines of the process that is happening. With mag stripe the approval flow was much simpler and happened in fractions of a second end to end. EMV is a different ballgame unfortunately.
• sundvor 9y ago
  Using Samsung Pay which uses NFC on my S8 / Gear S3 here in Australia and it's pretty much instant. And I get a digital receipt on my device straight away, which is awesome. Protected by fingerprint, or code, so feels more secure than the Mastercard plastic with embedded NFC pay wave. Tap based pay has become ubiquitous in Australia, and I love it.
• lsjdfkljdfwkwdf 9y ago
  after hundreds of comments, still not a single one answered OP's question......
• rawland 9y ago
  It depends on the card you use. The transaction suffers under several communication latencies and most importantly fraud checking takes up a significant amount of time. A lot is implemented utilizing legacy technologies (I implemented a system once), as the initial systems were setup in these and the banking/payment sector moves quite slowly. Anybody remembers the Y2K problem [0] ? ;-). [0]: https://en.wikipedia.org/wiki/Year_2000_problem https://en.wikipedia.org/wiki/Year_2000_problem
• dbg31415 9y ago
  So you think they are bad in the US? Live somewhere else for a while... you try the system in Australia and you'll REALLY think they are bad in the US. Ha. But yeah, compared to other places the US is lagging. By a fair bit.
• jaclaz 9y ago
  It depends not only on the POS itself (old models vs. new ones) but on the kind of connection. Here in Italy, besides "portable" POS that have a SIM card and go through GSM/GPRS (and are "good speed, but not that much fast") now also 3g/4g, the "corded version" can be: 1) Dial in (analogic) 2) Dial in (ISDN) 3) IP connected The difference between #2 and #1 is like 4/5 times faster ISDN vs. analogic, and the IP (provided that there are no network issues) is instantaneous. I would say: 1) 5-20 seconds 2) 1-5 seconds (and GPRS is roughly the same, 3g/4g is on the lower side) 3) 0-1 seconds (really, the sheer moment you press the green button, the receipt starts being printed)
• redbluff 9y ago
  Some of the answers are close, but no cigar. The main reason for the time delay is the offline authentication of the chip, combined with generation of the ARQC cryptogram. Additionally the EMV protocol is very chatty if there are multiple applications on the chip card, although the latency involved in the customer interaction far outweighs the protocol timings. As mentioned in many comments online transactions will be an order of magnitude slower, as they need to be sent to the issuer, have their cryptogram verified and the challenge response returned if the card does host authentication - which most do these days. The entry mode generally does not determine how a transaction is authorised - chip, PayPass (NFC) and stripe can either be off or online. In fact stripe transactions are invariably online unless you want your business to be overrun with fraudsters. One of the prime reasons in the early days of EMV was to have it so safe that offline transactions were fraud proof - or close to. Naturally this noble goal was shot full of holes the moment real fraudsters got to it. However, the card is personalised with various limits and counters and with the possibility of using an offline PIN, which combined with the static authentication does give reasonable protection for low value offline transactions. Fun fact - in the initial spec this offline PIN was communicated between the terminal and the card in the clear. What could possibly go wrong :-). These days it is encrypted. Anyhow enough blather - hopefully this has given a bit of insight.
  • germanier 9y ago
    What I don't understand is that even when using a German card with multiple applications, online authentication, and online authorisation[0] it's quite fast in Germany – much faster than comparable or even simpler transactions in the US. On the other hand, the very same card is processed even faster when used in Sweden. The difference is probably faster data connections and more efficient protocol implementations, I would think. [0]: For some reason receipts here contain quite a lot of information on what happens behind the scenes if you know how to read it. I hope this link keeps working, it contains exercepts of receipts merchants give you here: http://docplayer.org/storage/33/16568026/1498495227/GbAKHYXNokkJ8zeJocmv_g/16568026.pdf http://docplayer.org/storage/33/16568026/1498495227/GbAKHYXN... With that information you can e.g. see which steps were perfomed offline.
    • 9y ago
• cocoa19 9y ago
  This is partly perception. With a magnetic card, after you slide your card, you can put your card immediately in your wallet, while the Point-Of-Sale solution authorizes with the electronic payment host in the background. With a chip card (EMV card), the EMV spec required the Point-Of-Sale solution to write an authorization number to the chip card. This means you need to leave your card inserted in the PIN pad until the payment host authorizes. Authorization usually takes 2-3 seconds. To improve this perception, the industry came up with Quick Chip, which Point-Of-Sale software companies started to work on recently. With Quick Chip, the POS software doesn't need to write the payment host authorization number to your card chip anymore. You insert your card, account number is read, you take your card from the PIN pad immediately without waiting for payment host authorization. -Software engineer working at a Point-Of-Sale software company.
  • bichiliad 9y ago
    What's the advantage of writing the authorization number to the chip card? Will removing it reduce security in some way?
    • cocoa19 9y ago
      I used the term "authorization number", but that was misleading. The real name is issuer scripts. It is used by card issuers to update the card parameters (chips have memory). According to EFT lab, these are 16 functions which include: Card Block, PIN Change or Unblock, Update other data I haven't read the full Quick Chip spec, but here is my guess (take it with a grain of salt): If card issuers are not able to update the card, then they won't be able to block the card. If the card is misused (e.g. stolen), there is a very small chance of retailers accepting fraudulent payments, but at least the following conditions should be met: 1. The POS solution should be offline from the authorization host, 2. The card should allow offline authorization and it has a "max offline amount" configured, 3. The sales amount does not exceed the configured offline amount in the card.
  • sillysaurus3 9y ago
    Authorization usually takes 2-3 seconds. The question seemed more along the lines of "Why does it take 2-3 seconds to authorize?"
• db48x 9y ago
  Interesting fact: the best card terminals, if they are connected to a phone line rather than the merchant's broadband internet connection, use a 1200-baud modem. You would think that this would be slower, but the amount of data to transfer is relatively small. This means that the transaction time is dominated by time it takes to dial the modem and establish a connection rather than the time it takes to send the data. A 1200 baud modem takes much less time to negotiate a connection than a 56k modem, because it doesn't have to check the quality of the line as thoroughly. Reliability is better on noisy phone lines as well, and I'm sure they're cheaper. It's a win all around, but it's not something they mention on the spec sheet because it looks terrible. Of course that has nothing to do with the chip-based authentication.
  • justin66 9y ago
    It's been 18 years since I was involved in that industry, but I remember it being more a decision to use 1200, 2400, or 9600 baud with most processors. I don't remember any that even offered the option to connect at 56k. I think there were a few processors with protocols that were chatty enough that the time spent negotiating 56k might have been worthwhile. I remember the Gensar and FDMS protocols mostly being sane but there were a couple others that were "hey look at this BBS software I adapted to be a credit card processor for some reason."
  • aninhumer 9y ago
    Surely in a busy enough store it would be worth just keeping the connection open, at least during peak times?
    • Mister_Snuggles 9y ago
      A lot of POS terminals in Canada just use Ethernet to connect to the payment processor. For stores that already have internet they just hook into that, but for those who don't one of the local ISPs even offered (they might still) a $5/mo cable modem package just for POS machines.
• m3kw9 9y ago
  Network latency
• Taylor_OD 9y ago
  My question is why chip readers flash like 6 or 7 screens that all say DO NOT REMOVE CARD in one way or another before giving you a noise that could be described as, "transaction failed" before finally being successful. I wouldn't mind waiting the extra couple seconds if the process was a little more customer friendly.
  • dv35z 9y ago
    This is so funny, as this is an internal thought I have nearly every transaction. So counter-intuitive on the actual device interface, the LCD messages, and the audio queues...
  • Sohcahtoa82 9y ago
    Yeah, whoever decided the "Remove card" sound should sound like a buzzer needs a few lessons in UX. A simple "Ding!" sound would be far better.
  • ghostly_s 9y ago
    All the ones I've used also prompt "is this amount correct?", "do you want cash back", which are additional time-consuming steps which require your attention to be on the terminal and were never part of the process before these same terminals switched over from swipe transactions.
• twothamendment 9y ago
  Just two days ago I wondered how Costco was so blazing fast. I have the same hardware on my desk for development, but whatever they are doing is very different than what our partner is doing. I was only guessing - but they only have one bank to deal with?
• FrostAlot 9y ago
  Came across this article which talks about what goes on in the background: https://tech.affirm.com/deep-dive-payments-60f5d17f6c71 https://tech.affirm.com/deep-dive-payments-60f5d17f6c71
• IgorPartola 9y ago
  And how come Apple Pay is so much faster than the chips + signature or chip + pin method?
• cmurf 9y ago
  The time varies widely. The remove card notice comes as fast as 3 seconds, I find 6 seconds more typical, and up to 15 seconds for the local grocery, and nearly 30 seconds for small pizza, sandwich, liquor stores. There is no possible way it was taking this long for swipe authorizations; or even NFC authorizations which seemed faster than swipe but were probably the same, but more secure. I still think the U.S. did this exactly wrong. 1. we were late to the game; 2. had started adopting better NFC technology; 3. instead of building on that, regressed to an old slow contact chip-based system; 4. instead of moving directly to PIN entry, retained signing, hence chip & sign, rather than chip & PIN. It's idiotic. And that's just the customer size idiocy. The merchant idiocy is even worse. They paid for this transition. Not the banks, the processors, or EMV who ensure they make money hand over fist no matter what. If a customer has a chip card, and your POS does not support chip reading, the liability for fraudulent transactions is shifted to the merchant.
• exelius 9y ago
  In many cases (RiteAid pharmacy terminals are the absolute worst about this, but far from the only offender) it's just crappy UX design. I have an American Express card and a RiteAid rewards card. Here's my checkout flow at the pharmacy: 1. Punch in phone number for rewards card 2. Get prompted to use my "Plenti" points; which require PIN entry 3. Swipe/insert card (most RiteAid terminals used to work with Apple Pay, but had it disabled) 4. Get prompted to use my American Express points. Say no. 5. Enter relevant pharmacy details (DOB, verify pharmacist reviewed prescriptions for you) 6. Remove chip card 7. Sign paper receipt This UX flow is simply too complicated for a checkout process. It's got way too much friction, and they disable contactless payments to ensure you can't circumvent that. Making these payments process more quickly is great; but Apple basically already solved that problem with Apple Pay. But it's not effective because it seems that some retailers want more friction in this process.
  • BlackjackCF 9y ago
    It really doesn't make any sense to me why retailers want to be doing this. I thought people would really get behind the credit cardless approach. When I went to China, I was absolutely amazed by how well everything in Shanghai integrated with AliPay. My family was able to go to some restaurants and order + pay with minimal interaction with a waiter.
    • exelius 9y ago
      My guess as someone who doesn't actively work in this stuff (but have dabbled in it) is that some large merchants get a break on transaction fees with chip/swipe that they don't get with Apple Pay/Samsung Pay/etc. An extra 0.05% in savings wouldn't matter to a small store, but for a national retailer, it's probably a meaningful amount of revenue.
• zeep 9y ago
  I don't know why but there is a convenience store around here that is faster than everybody else... I need to ask them what their trick is. I think that it is as fast as magnetic strip readers (not as fast as McDonald's strip reader, but as fast as most).
• astrostl 9y ago
  My hot take on them: - my wait is annoying, population person-hour waits are breathtaking to consider - all of my breaches are internet-based anyway, so I don't see how it helps much If all my CC transactions had an optional, on-the-spot second factor, now we're talking.
• Fbleite 9y ago
  I'll recommend the following white paper. It explains in quite some detail the specifics of your question. Cheers https://www.ul-ts.com/offerings/knowledge-sharing/white-papers/featured-white-papers/insights-on-emv-transaction-speed-pos-performance-optimization-/c-39/c-2004/p-2089 https://www.ul-ts.com/offerings/knowledge-sharing/white-pape...