Shoppers Prefer PIN-Based Debit to Signature Debit: Survey

STAMFORD, Conn. — Banks and credit card issuers have put significant efforts into marketing contactless and signature-based debit card payments, but they have failed to win over consumers, according to a new survey by Gartner here. “Despite significant marketing campaigns by banks and card issuers to steer consumers towards using debit cards with a signature — ostensibly so that the banks can earn more interchange revenue — consumers prefer entering their personal identification number (PIN) to pay for groceries with their debit card over all types of signature-based card payments, whether credit or debit,” said Avivah Litan, vice president and distinguished analyst at Gartner. The survey, conducted in August of 2007, queried 4,500 online U.S. adults. When shopping at grocery stories, consumers prefer debit card payments that require entry of a PIN despite the fact that only debit and credit card payments with physically signed receipts typically earn them reward points. “Brick-and-mortar businesses who accept electronic consumer payments should promote use of PIN-based debit card payments by steering consumers to them through payment terminal programs and/or by offering store-based incentive programs,” Litan said.

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