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SUPER clever idea -- kudos for that. In theory, this is awesome. As a consumer, I love it. As a merchant, however (which I am), there is no chance I would ac
by nlh 13y ago
SUPER clever idea -- kudos for that. In theory, this is awesome. As a consumer, I love it.
As a merchant, however (which I am), there is no chance I would accept this. None. Unless the issuers (that is, Visa, MC, Amex) drastically change their policies, which I don't see happening anytime soon.
Why? Because the issuers are very clear about a few things: When push comes to shove and it REALLY gets down to it, unless the merchant takes a physical swipe of the actual card AND has backup to prove it (i.e. an imprint of the physical plastic), the issuers will side with a consumer in the event of a fraud dispute.
So why, do you ask, do most merchants not bother taking imprints of the actual cards? Because a visual verification and physical swipe is usually enough (for 99% of cases). Instances of fraud via card duplication are rare, so it's usually not worth the hassle. But in some cases, it is.
My business runs large-ticket purchases though CCs (average is $2000), and we take super extra precautions when our customers buy from us. We take magnetic swipes, visually verify, AND take physical imprints.
We've lost several chargebacks because of lack of doing this. You'd be surprised how these little-known rules crop up when you least expect them. "Sorry, customer claims charge not authorized. Merchant doesn't have physical imprint. Chargeback approved." It's happened and we've been defrauded out of $thousands because of it.
The ONLY way we've been able to successful combat chargeback fraud is through the multi-layered approach.
Anyway, I know this is a fairly esoteric perspective and my business may be different from lots of others where this isn't an issue, but I have a feeling V/MC/Amex aren't going to get behind this.
- cbsmith 13y agoYou must do a lot of online business. ;-)
- jhandl 13y agoI love the idea behind Coin but what I need is a fat wallet. I carry 19 cards, of which 16 are essential. Some of them are not for swiping so they wouldn't benefit from Coin. The solution for me is a wallet that can hold 20 to 30 cards, but as far as I can tell there's no such thing.
- kevincrane 13y agoOut of curiosity, what do you do that requires 16 cards on a regular basis? At some point, the limiting factor of how many cards you can carry becomes your pant pocket (or purse). My jeans wouldn't stand more than a few cards and far less than 30.
- taude 13y agoHere's my list: * Costco membership card * three loyalty shopper cards for my common stores (I need the physical card because none of the apps I've tried using that scan the bar codes work with store scanners) * a card to pay for my train rides, * bank debit card for ATMS * business credit card * personal credit card * medical insurance card (this one would be easy to just use a photo of) * AAA card (would be easy to use photo of) * Zip Car Card * Bus pass card for corporate shuttle * Airlines MVP card (likely easy to just use a photo of, I think....though I'm not sure about speedy checkin). * Access card for corporate office. * Drivers license I have about 25 other cards that I keep at home, like Library, more shopper perks cards (usually because they can lookup by my email address in store), etc.. This doesn't really help my wallet situation that much.
- bane 13y agoDon't know if your personal card is an Amex or not, but my Amex is a Costco Amex and doubles as my membership card. I'm surprised your loyalty cards aren't the smaller key ring ones. I have half a dozen on my keys and barely notice them. I leave my AAA and Airline cards at home and pull them out when I need them for trips. Could probably do the same for your Zip Car card (unless you use the service multiple times a week or something) and other rarely used cards. Last year my medical insurance company switched to paper cards which are much thinner and easier to deal with even if they're less sturdy. Same as my car insurance. All that being said I still walk around with about a dozen cards in my wallet, so I can definitely sympathize. But I could probably edit out 3 or 4 right now and not really miss them.
- taude 13y ago
- jonstjohn 13y agoFor most self-swipe checkouts, it seems like this card would work well (coffee shop, grocery store, etc). But, it isn't too uncommon to have a merchant request to see the card, and some larger retailers (e.g., Lowes) have to input numbers off the front of the card, as well.
- yial 13y agoI know that the processing at the one store I work at requires that we input the last four of the card. There's no way to over ride this on our end.
- kenrikm 13y agoI purchased one and I'll use it for all my loyalty cards which should help my wallet to be thinner - except Costco since they require you to show it! Not sure I would use it with my actual debit card but it does have the "that's cool" factor, congrats to the team I expect this to be a very successful launch!
- tedivm 13y agoMany credit card companies are starting to issue new cards which are completely flat, making it impossible to make imprint. My new CapitalOne card is an example of this. Is your company planning on refusing to do business with them?
- pbreit 13y agoImprint was just an example. You can take a picture of it, view the CVC, etc. No one imprints anymore.
- pbhjpbhj 13y agoHow can you prove the pictures is the card and not just 'shopped though. With an imprint there's a larger barrier, creating an embossed card, doable but a barrier nonetheless. With credit cards, unless there was a unique image on it then you'd often be able to guess from the number what the other card details should look like.
- potatolicious 13y agoI'd argue that shopping a believable picture of a credit card that stands up to scrutiny is a higher barrier than the imprint - which really just involves some movable letters and carbon paper...
- sxtxixtxcxh 13y ago> No one imprints anymore. that's not true at all; have you been outside of any major city in america?
- coldtea 13y agoAs an avid road fan, I've been in 47 out of 50 states (no Hawaii, Alaska or Vermont) and roadtriped around 50.000 miles, in the course of 7 years. I've stayed in hundrends of small cities, from Ogalala, NE to Ozona, TX and Oatman, AZ, and used my credit cards for all kinds of purchases, from Kroger and CVS, to outlet stores, gas, local shops, small eateries, fast food places, restaurants etc. Never had a vendor inprint my card.
- tmoullet 13y agoMy latest Visa credit card has the numbers printed onto the plastic; the numbers are not relieved/raised. How do you take a physical imprint of these types of cards?
- driverdan 13y agoYou took the words out of my mouth. No merchants should accept this card unless they want to be liable for chargebacks. If this product is actually released I wouldn't be surprised if a clause is added to merchant agreements to explicitly disallow accepting this type of card.
- PeterisP 13y agoMerchant agreements already disallow accepting it, since it is not a valid card - it's not issued by a valid issuer, it has no Visa/MC logo, it doesn't have the signature on it, etc - the 'Card Present' rules would say that this object is not a creditcard. It's just like any cloned card - I can easily make a blank white card with a copy of my creditcard's magstripe, and technically it will work in a swipe POS-terminal, but any merchant is required to refuse such a card, and recommended to detain the card and me, if it's safe to do so, or call the cops.
- Nursie 13y agoI don't know why the US hasn't adopted EMV. It's not perfect, but it has cut down fraud massively here in Europe. They're very hard to clone (I won't say impossible, but attacks against EMV have not generally been of this nature) and the transaction records at both ends will tell you whether the actual, real card was there. The liability is more clear-cut as a result. If the customer claims the charge was unauthorised, that's between the bank and the customer. --edit-- of course with EMV cards Coin would no longer be possible or relevant. Neat product, only useful in a magnetic-stripe world, which is at least a decade behind the curve now. Theoretically with EMV you could put all your credit-cards on one chip and the terminal will either choose a supported default or present you a list, but that would require cross-bank cooperation, never going to happen.
- pbreit 13y agoBecause it's a massive cost for almost no gain.
- huhtenberg 13y agoDo elaborate on "no gain".
- pbreit 13y agoA few basis points.
- huhtenberg 13y agoYou'll have to dumb it down, I have no idea what this means.
- tyohn 13y agoI work for a merchant also... high volume low ticket. My thought is: Since most of our customer transactions (swipes) occur without any cashier involvement - how would V/MC know that the "real" card wasn't present?
- capex 13y agoExactly. Most of the merchants/ shops out there have no idea what my card should look like.
- the_economist 13y agoI go weeks at a time without getting asked for identification when paying with a credit card. Most merchants will happily swipe the coin and move on with their life. Those that question it can still check ID or make a copy of the driver's license. This is a sweet product and I can't wait to dump the 7 cards in my wallet. One extra backup card, a good thing to have regardless, will take care of the occasional merchant who won't accept coin. btw, it sounds like you should have had a lawyer handling some of those chargebacks, particularly if you had captured the driver's license info. We started using a (cost conscious) lawyer to deal with every chargeback and our win rate went way up. And by "dealing with a chargeback" I mean forwarding along our response on his letterhead.
- drivers99 13y agoMerchants aren't allowed by their merchant agreements to require your id in order to accept a credit card. They are supposed to check your signature. https://www.privacyrights.org/ar/Alert-FS15.htm https://www.privacyrights.org/ar/Alert-FS15.htm
- vidarh 13y agoThey are not asked to accept a credit card in the case of Coin. They are asked to accept a device that contains an unauthorised reproduction of the mag-stripe contents of a credit card.
- trustfundbaby 13y agoExactly. I feel like they would have been more successful going after things like rewards cards first and then after proving legitmacy and market need there, trying to take a stab at the credit card market.
- abalone 13y agoI think you are mistaken about card rules. To protect themselves against chargebacks the merchant needs to keep a copy of the signed credit card slip, not a physical imprint of the card. That's actually better than a physical imprint (which is impossible on many cards these days anyway) because a matching signature can prove who used the card, not just that the card was physically present.
- nlh 13y agoWorth looking into! Thanks. I know there's been at several cases where we specifically lost because of lack of imprint, but another thing I've learned in dealing with the credit card issuers is that, despite what we hope, there is MASSIVE inconsistency in the application of chargeback rules. Sometimes you'll lose a chargeback because the issuer just wants to be nice their cardholder (Amex is guilty of this) and they'll literally make up reasons for the loss. We actually had Amex _negotiate_ with us over a chargeback once. I had no idea this was even possible -- they actually said "So how about we'll agree to split the loss. We'll cover half, you guys cover half." I had no idea that was even an option.
- scholia 13y agoMy understanding is that US banks can write a proportion of the loss off against tax, so 50/50 splits are not that unusual. But it probably depends on the circumstances. I'm in the UK and this is not really my area, so you'd probably have a better chance of verifying that than me.
- lectrick 13y agoNo big threat to the spread of chargeback-free bitcoin... Got it
- deleted 13y ago[deleted]
- vlokshin 13y agoThese are some very solid counter-arguments to the awesomeness of what Coin could be, and I really hope you're wrong... but you make some very solid points, with the experience to back it up.
- skulquake 13y agoRemember when the merchant used to imprint the cc with receipt paper and sliding a pen over it to get the card imprint. My how time flies.
- tiglionabbit 13y agoMany card reading devices these days support near-field communication and will allow you to pay using your smartphone. In this case there isn't even a card. So some merchants will surely be fine with this physical card solution.
- steven2012 13y agoIf you swiped my card AND took physical imprints, I would be really suspicious that you were storing my credit card information for future fraud. There's no reason for you to take an imprint as well as swipe, since you have the authorization code for the card present transaction, and the signature, which should be enough to fight chargebacks.
- egwor 13y agoYou guys don't use chip and pin? This is where you have to enter a code to do the transaction
- deleted 13y ago[deleted]
- baddox 13y agoHow do you explain the plethora of online stores, including massive and presumably legitimate ones like Amazon, which accept Visa and other major credit cards?
- joewee 13y agoRelated...some stores have started entering the last 4 digits of the credit card into their POS. This will work even if the card is flat and is obviously used to verify that the card number encoded on the mag strip is the same as the one on the face of the card. If this becomes more widespread coin will have problems.
- downandout 13y agoSome POS systems ask the cashier to type in the last 4 digits of the imprinted number on the card, which wouldn't work for this. I also know of several merchants (Hertz was one, a casino was another) that actually runs a card through a scanner and records an image of both the front and back. There are several scenarios where this wouldn't work. On the other side of it, I love the idea, and the only way to get merchants and card companies to begin changing their policies is for someone to be first through the door. This will not work for all situations at first, but if it proves popular it could easily sway these policies. Imagine some of the possibilities. Just as an example, imagine getting a pre-approved credit card offer in your email, then having the new, swipeable card instantly downloaded to this device after a few verification questions. Credit card companies that worked with Coin could gain an instant competitive advantage in the cut-throat credit card marketing business. This could also revolutionize the loyalty card business.
- WesleyJohnson 13y agoThe display on the coin shows you the selected card, the expiration date and the last 4 digits of said card. So I believe your first point is moot, assuming the display stays active at all times or for a long enough duration that the cashier can get the last 4 digits as needed.
- bonestamp2 13y agoYou're right that it displays the last four, but the whole reason why the cashier has to type in the last four digits is a check that the physical imprinted numbers on the front of the card match the data on the magnetic stripe. Typing in the last four on the coin completely bypasses this anti fraud measure since the last four will always match on the coin because the digits it displays come directly from the magnetic stripe data. Cool product. I want it to work, but I fear it won't be widely accepted. That said, if they were to license the visa and mastercard logos for it, that would probably be enough to get it accepted during most transactions by cashiers who aren't savvy or don't care.
- ashcairo 13y agoCan't the merchant just treat it like an online payment. Take the Card number, expiry date and security code?
- PeterisP 13y agoNo, most retailers can't accept online payments (or "like an online payment") - if they want to, that's a different kind of agreement with different (higher) fees and more liability for fraudulent transactions. If they want to book it as 'card present' transaction, then they have to follow the 'card present' guidelines - which, by coincidence, would require them to see the actual card, not just it's magstripe data in some fancy device.
- chazandchaz 13y agoknucklebusters (card imprinting machines) are not required or even recommended by processors. The tide had turned on imprinting in the majority of industries.
- musclman 13y agoYour business is a fringe case that you admit takes "super extra precautions", which clearly doesn't represent the majority of merchants. In fact, as a consumer I can't remember the last time a merchant took an imprint of one of my cards.
- guiambros 13y agoI can't remember the last time any merchant took an imprint of my credit card. Certainly not this year, not even on large transactions. Given your large average ticket, it makes sense to be extra paranoid and take an imprint (mostly to avoid scammers), but certainly doesn't apply to 99% of merchants. I don't think this would be a roadblock for them. Unless, of course, Visa/MC/Amex finds some obscure legal clause (or technical way to detect the different card) to shut them down.
- kparashar 13y agoWe have already built basic precautions where Coin couldn't be used for skimming. Give us ab it more time to show how when a Coin user walks through the door, you can count on a valid user.
- mcv 13y agoI don't understand America's love for credit cards. They're unsafe, both for users and for merchants. PIN cards are safer, and they're much clearer about where the risks and responsibilities lie. Of course modern credit cards also support PIN, but I never see them used that way. A more convenient way of handling credit cards is a useless idea to me. What we need is a safer and more reliable way to handle transactions. Preferably one that doesn't rely on politically motivated monopolists.
- whitej125 13y agoWondering if they could develop a multi-factor auth model to complement the card to make the CC company's happy. Thinking out loud here... could you make the use of the Coin card dependent on being within range of your bluetooth enabled cell phone. If the card knows that it is being swiped (not sure if it does)... then the in-range phone could know and send a msg to the CC company with the shared secret saying "yo, it's legit". Now a thief would have to steal both the phone and the card for it to work. I'm sure there are a million holes in this, but just putting it out there. Similar concept could work regular CC's as well. CC company comes up with "card swiper 2.0!" and deploys them to merchants. I as a consumer get some incentive from the CC company to register my device with them. When my card get's swiped at a merchant... card swiper 2.0 tries to detect my device. If it sees it, great, lower chance of fraud. If it doesn't, give me a ring to see if I'm aware that my card was used or deny the charges. Might help the triage the sheer number of transactions out there for what's fraud and what isn't.
- wil421 13y agoThis is BS. No one takes imprints and you dont need to. I worked in the service industry for years and took a credit card from 80% of all my customers and never once took a imprint or needed to. I have seen flat cards without numbers that would be impossible to imprint.