What is pin-debit?

Pin debit refers to a credit card transaction in which the buyer enters their 4 digit personal identification number (PIN) into a merchant terminal in lieu of a signature, when using a debit card.

Debit cards are usually associated with a checking account, but may also be a savings account. Regardless of the account, the card will ALWAYS have the DEBIT symbol on the front of the card. Newer cards usually have a holographic Debit symbol.

With PIN DEBIT the merchant pays a fee to the debit network instead of Visa & MasterCard interchange. This fee is under $1.00 per transaction, usually around $0.50 and the fees vary by debit network.

With SIGNATURE DEBIT, Visa & MasterCard have different interchange rates for debit card usage. With very few exceptions, such as processing greater than $420 million annually in debit or for supermarkets, the lowest rate for debit card interchange, which all payment processors pass on to merchants, is 1.03% plus $0.15 per transaction. More details are available by checking the latest interchange rates.

Pin-based debit transaction merchant fees include:
1. Per transaction charge from your Credit Card Processing services company.
2. Debit network charge (Debit Network Acquirer Fee). This fee varies depending upon your region of the country and the network that the cardmember’s issuing bank belongs to. The region determines which debit network the individual transaction will clear through.

Debit network acquirer fee examples:
Interlink Retail $0.175 + .75% (max of $0.525)
NYCE Retail Std $0.1375 + .65% (max of $0.6875)
Pulse (Includes Tyme) 0.16 + .65% (max of $0.71)
STAR (Includes MAC, Cash Station & Honor) $0.1625 + .65% (max of $0.6425)

Pin debit is best used if your average transaction is over $25. That’s generally a good break even point as to whether it’s cheaper to process via pin debit or signature debit.