Walmart’s Visa PIN Lawsuit Puts A “We Want Security” Face On A “We Want More Money” Argument

With their frequent lawsuits and counter-suits, Walmart and Visa is that always-quarreling couple that stays together for the sake of the kids. Only in this case, the kids are the piles of money each makes from the other. Alas, anything that forces the argument of PIN versus signature into the light is a good thing for payments and, by extension, payment facilitators.

Quick update on the latest example. On Tuesday (May 10), Walmart sued Visa, with the largest merchant saying that the largest card brand is forcing Walmart to accept signature on debit transactions when it would rather accept PIN. Walmart’s argument is that PIN is more secure—which it is—and Walmart neglects to stress that Walmart can save money by processing PIN transactions elsewhere.

Walmart e-mailed a statement to media saying that “this suit is about protecting our customers’ bank accounts when they use their debit cards at Wal-Mart. We have long advocated for ‘PIN verification’ as opposed to the less secure signature verification for debit transactions. PIN is the only truly secure form of cardholder verification in the marketplace today and it offers superior security to our customers.”

Even though the PIN security issue is a smokescreen in this case—albeit a very convenient smokescreen—there are bigger issues here than just money. Visa’s much bigger strategic priority is getting EMV accepted, deployed and embraced as widely as possible and as quickly as possible, with both consumers and merchants.

With that “massive adoption” goal as Visa’s top focus, it’s understandable why signature debit would be attractive. Anything that makes it easy for the shopper is good for fast and wide adoption. This is a nuanced argument, with no perfect solution. Even Visa’s move last month to try and accelerate the perceived EMV transaction time advanced that “easy is good” argument, while simultaneously losing ground on the “consistent experience is also good” argument.