Gas Pumps Have to Automate Payment Schemes – Demands Visa, Mastercard
Mastercard and Visa will soon compel payment mechanisms at gasoline pumps to accept only cards with a personal identity number and an “embedded microchip” before a transaction can be completed.
This new way of payment will be introduced to mitigate the use of fake credit cards to purchase gasoline. Older cards which use magnetic strips can easily be copied by criminals.
Several gasoline distributors are against the new technological change in payment innovation, even if this may increase anti-fraud efforts. Currently, gas stations owners are placed in a spot where they have no choice, but to comply otherwise they would be more susceptible to fraud.
Wilson Fuel Co. Ltd. vice-president, Dave Collins, said that it may cost their company as much as $5,000 per pump to change their payment mechanism.
The major credit giants gave an October 1 ultimatum this year or else the losses caused by any fraud-related transaction after the date will be absorbed by the merchant.
Although the changes have already been introduced in several cities in Canada and soon in the United States, there may be a noticeable ‘harsh effect’ in places where gasoline prices are regulated and where there is a lack of mechanisms to effectively provide enough financial logistics to cover the cost of technological adjustments.
Collins said that governments should have a willingness to be sensitive to cases such as these since it involves a crucial utility.
Incidentally, both Mastercard and Visa have been criticized for also increasing their transaction fees by as much as 30%.
Wilson Fuel Co. Ltd. has not converted any of their pumps yet as of press time. Collins explained that this is because the technology “doesn’t exist” and neither are there installers capable of getting the job done. However, he did admit that it may take about a year until all gasoline stations adjust to the new payment scheme.
Collins said that some dealers may compromise convenience and resort to going back to the traditional means of asking customers to pay in cash instead.
Canada-based Suncor, a big player in the gas industry, may opt out of collecting payments through credit cards in their stations which may force others to follow suit.
Collins explained that there should be more cooperation from banks and credit companies to work together with merchants to make this new scheme workable.
Since fraud is also a common enemy to both the bank and gas industry, he said that their company would be willing to pitch in as long as there would be mutual financial cooperation.
