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Sat May 21 2016 23:40:11

Etsy, Walmart Impacted by Debit-Card Bans

By: Ina Steiner

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We've discovered that some small banks are banning debit-card transactions on purchases made in New York State, and it's impacting shoppers trying to purchase goods on Etsy, which is based in Brooklyn. Last fall, some banks put a similar ban on debit card transactions made at Walmart. 

Many people now use debit cards for their transactions, and they may not realize that they could encounter these types of problems. The issue was brought to our attention by a reader who pointed us to a thread on the Etsy boards. A shopper said she could not purchase items on Etsy using her debit card because her bank banned debit card use on all PIN-less transactions in the state of New York.

A large red banner appears on her bank's website, and the announcement explains:

Debit Card Transactions Being Denied in New York
We are experiencing a high amount of debit card fraud in the state of New York. In order to protect our customers, we are temporarily declining debit card transactions in the state of New York unless a PIN is used.

Please use your PIN number when using your debit card in the state of New York.

We sincerely, apologize for this inconvenience and we hope to remove this block soon.

Many Etsy users were shocked to learn of the ban - some wondered if it were legal. Etsy sellers discussing the issue then found a bank in Indiana that was also blocking New York State debit-card transactions.

It's not just New York - in 2014, Provident State Bank issued a warning to its debit card holders, advising them that, "When traveling to an area that is heavy with card fraud, such as the states of California, Texas, Wisconsin, Washington, New York and Florida, you may find your debit card (if used as a credit) is declined."

And not only can banks and credit cards prohibit PIN-less transactions in entire states, it can also ban retailers. An article in CSO Magazine reported last year, "Consumers are being warned about an uptick in the number of fraudulent purchases being made at Walmart, which in some cases has resulted in their financial institution moving to deny debit card transactions unless a PIN is used." 

The article has some great background that's a must-read if you use debit cards to do your shopping. It also had a warning for consumers: "If you don't catch (debit card) fraud within 60-days and notify the bank or credit union, your liability for fraud could jump from $0-50.00 to $500.00. After that, you may be liable for the entire amount."




Comments (11) | Permalink

Readers Comments

Etsy, Walmart Impacted by Debit-Card Bans   Etsy, Walmart Impacted by Debit-Card Bans

This user has validated their user name. by: Philip Cohen
Web Site

Sun May 22 01:04:21 2016

Maybe it's different in the U.S.—after all some banks in the U.S. ridiculously allow EMV credit card "chip+signature" transactions—but, in Australia, all debit card transactions at a physical point of sale require—and always have required—a four-digit PIN; with the now ubiquity of NFC terminals, credit card transaction in excess of AUD100 also now require a PIN; only contactless credit transactions under AUD100 are PIN-free.

On the other hand, on-line payments, whether credit or debit, are by their nature PIN-less; that is why both credit and debit on-line transactions cost the merchant the same higher (2-4%) fee, a much higher fee than the nominal (~30c) fee charged for a PIN-based debit transaction at a physical point of sale.

Otherwise, there is no difference between the two except that a debit transaction is against your debit account and a credit transaction is against your credit card account.

Regardless, I prefer to use my credit card for such purchases because it keep all my petty purchases from cluttering up my debit bank statement, and it costs me no more.

There is definitely something weird about the U.S. banking system; it's not only the cretins at eBay that haven't got a clue, apparently …

Etsy, Walmart Impacted by Debit-Card Bans   Etsy, Walmart Impacted by Debit-Card Bans

This user has validated their user name. by: White Rabbit

Sun May 22 08:02:18 2016

Expect this to get a lot worse. I can see a mass exodus from Debit cards in the future. this is by the way a good thing for paypal? my Well Fargo requires checking accounts to use their debit card 10x a month for free checking as a pen-less transaction. That may change? LOL

Looks like the nations congress approved thieves--- "the Banks" are rushing to figure out how to escape paying the theft that Visa and Master card was covering before the chip?

Etsy, Walmart Impacted by Debit-Card Bans   Etsy, Walmart Impacted by Debit-Card Bans

by: comet This user has validated their user name.

Tue May 24 03:19:19 2016

WalMart has at least installed the chip readers in my part of NY State;  in others they are still using the older swipe ones.  In Canada before we had a chipped card one of the IKEA cashiers grabbed my husbands debit card and smacked it on their TAP  reader so hard they broke it.  

The Chip readers are  a PITA---they are slooooow and the people behind you are standing there wondering if your card was declined;  you need to do a PIN and it just takes too long.  

I live in NY and my bank is local---wonder if I will have to leave them for a credit card?  I would not want to do that as I am not a fan.  

There are also lots of people who for one reason or another do not HAVE actual CREDIT CARDS---past problems;  unwilling to chance running up debts;  cash income; and what are THEY going to do?  They might have been perfectly happy with a debit card.  It seems like it would be up to the BANKS to make SURE the transactions are SECURE-=-not telling customers after the fact TOO BAD SO SAD you can't get gas  or lunch or that medicine your kid needs because WE cannot figure out how to make it SECURE.  

Must be following eBay's lead--blame the CUSTOMER for your lack of programming and security.  

Etsy, Walmart Impacted by Debit-Card Bans   Etsy, Walmart Impacted by Debit-Card Bans

by: Watching the Wheels This user has validated their user name.

Tue May 24 05:18:20 2016

Here's a SIMPLE way to make transactions secure. Put people back into the equation, and remove all those nasty little machines that will accept X's, and smiley faces as signatures.

WE have put far too much faith into machinery, and the slightly odd tech brigade that does the programming.

This will wind up furthering the divide between the haves and have nots.

Etsy, Walmart Impacted by Debit-Card Bans   Etsy, Walmart Impacted by Debit-Card Bans

by: frustrated This user has validated their user name.

Tue May 24 08:03:13 2016

Yeah the banks are SOOOOO worried about MY money that I can sign ELIZABETH TAYLOR and they will put it through (try it once or twice and see) you can also write I'M NOT PAYING FOR THIS - same deal.

If they wanna fix the problem, they should ASK FOR ID as I have written on back of every card, rather than signing them.

Watching the Wheels is right.

The fix is not to give me a card that can be swiped from 10 feet away.  USE COMMON SENSE.

Etsy, Walmart Impacted by Debit-Card Bans   Etsy, Walmart Impacted by Debit-Card Bans

by: frustrated This user has validated their user name.

Tue May 24 08:04:09 2016

BTW ONCE in 10 years I was asked for my D.L. by a 60 year old lady at SEARS.

ONCE

Etsy, Walmart Impacted by Debit-Card Bans   Etsy, Walmart Impacted by Debit-Card Bans

by: NoFreeLunch This user has validated their user name.

Tue May 24 08:11:38 2016

Last fall, a relative of mine traveled to a Western state and used their debit card at Wal Mart.
Just last week their debit card was used to withdraw money from an ATM 10 miles from that Wal Mart. They had the PIN number, too. Something is going on with Wal Mart security? How does one withdraw money from and ATM without the card? I don't know because I don't use debit cards, and use a credit card only in an emergency, or online. An emergency is when your car breaks down while on a trip or the frig. unexpectedly dies. Use cash whenever possible and ditch the debit cards. The money changers that talked you into this being the greatest thing, are just sucking you dry,and tracking everything you and everything buy.
Data mining makes them big money, too, while you pay the price.

Etsy, Walmart Impacted by Debit-Card Bans   Etsy, Walmart Impacted by Debit-Card Bans

by: Jennifer S This user has validated their user name.

Tue May 24 09:09:51 2016

Several malls in my area ask for ID for all credit and debit transactions, probably due to the high number of stolen cards being used in the area. In other places, I sometimes sign the card reader screen #SwagMoney just to make my kids laugh.

Etsy, Walmart Impacted by Debit-Card Bans   Etsy, Walmart Impacted by Debit-Card Bans

by: Moonwishes This user has validated their user name.
Web Site

Tue May 24 09:51:23 2016

This is very interesting. I have been tracking what states I get orders from for two years now. I have them dvided by venues. The largest number of orders by state come from CA, TX, NY and FL. Is it because they are so populated and with more people that want to send money? So are these the most popular states for problems due to high population or because there truly is a problem there?

My son only has a debit card as he has no wish to take chances with credit cards. He can only shop on line with the debit card. I will have to mention this to him before he wonders someday why his 'charge' is being denied.

As to the chip readers. My debit cards have the chip, but so far only one store that I can remember has a chip card reader and that is CVS - convenient since I have to shop there so often. One other store had the chip reader working and now they are turned off again.

It seems though that there will always be people that want to rework the system to defraud people. I order one thing once from Walmart which magically turned into something else before it got to me. But things got all messed up and it looked as if someone in the warehouse had access to my info as it was the closest I had ever come to being scammed/spammed. I wrote in to the the company to explain what had happened, and they denied that they had a problem. As a long term on line seller, I know how transactions are supposed to go down. And this time it was weirder than weird especially since the only reason I had ordered from them was to get something that was no longer available at my local stores. Instead of getting that I received something else that was completely available. I knew what I had ordered. The item's packaging did't even look alike! So Walmart with problems, I won't shop on line with them again, I believe some employees have their own little 'side' business going. No one wants to take the chip card, and for regular debit/credit cards, anyone can read the three digit code on the back of the card.

Etsy, Walmart Impacted by Debit-Card Bans   Etsy, Walmart Impacted by Debit-Card Bans

by: Watching the Wheels This user has validated their user name.

Tue May 24 10:41:34 2016

@frustrated, who knows? Maybe there are peeps out there who have decided to contest card use, AFTER THEY REALISED HOW COMPLETELY UNSAFE ALL THOSE STUPID MACHINES ARE.

I know that "I" had regretted NOT having done a major shopping spree, the first time I got cute and signed with an "X". AND knew, how unsafe any of our cards had become. I also knew that it would take people trying to get out of purchases, before any issues were addressed.

It boils down to YET ANOTHER SET OF NUMBERS THAT WE WILL BE EXPECTED TO REMEMBER.

I am SICK TO DEATH, of passwords, inane security questions, pins, and a host of other garbage that I NOW am expected to do, as opposed to the people who are hoping that I spend MY MONEY WITH THEM.

EARN MY $$$$$$! <--- THAT'S A NOVEL APPROACH.

Etsy, Walmart Impacted by Debit-Card Bans   Etsy, Walmart Impacted by Debit-Card Bans

by: comet This user has validated their user name.

Tue May 24 12:54:50 2016

@NOFREELUNCH---Your friends card was CLONED;  they should CANCEL  at once and notify  their bank and the local store and the police there;  the thieves  made a NEW card  to use at the ATM.  I am guessing after thieving the info from  your friends card via a CAPTURE DEVICE  on a swipe reader OR some have been accessed remotely via  some one standing nearby  or if the cashier takes the card they might have a device on THEIR side that captures  the info.  Nasty  and can clean you out fast  plus gives them access to all of your OTHER info.

The CHIP is meant to do away  with this;   if that is working or not I dunno;  half the places here HAVE the readers but with notes taped  to them saying NOT to use them!  

My kids debit was hacked twice;  once for a large sum by ALIBABA!  Or some one pretending to be Alibaba===who knows.  

I don't sign my card as my bank told me NOT to--if they want to ask for ID that's fine.  I can only remember ONE time that I WAS asked  and that was a while ago  at a Bed Bath and Beyond where they had a FIT because  the wallet I keep my E-License is NOT the same as the one I keep my cards in  and I had left my  bag in the occupied car and just grabbed the card wallet.  Used my smart phone to text  some one in the car who brought in the right wallet.  

Somewhat OT----we needed to go to DMV  and register a new car.  I had carefully used my License to fill in the paper work in advance;  and had carefully put everything  BACK  in my purse. So  imagine my SURPRISE  to have THAT wallet come up---missing at the DMV!  The clever lady  there was able to pull up my image  on their data base  and so we were able to complete the transaction but---and when we got home I discovered that I had not in fact replaced that wallet!  Phew!   Could have meant another hour and a half round trip  to the DMV.  

Technology  is a double edged sword.  



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