“Swipe your card.”
We hear it in restaurants, gas stations and retail stores. It’s fast. It’s convenient. And, it’s a growing trend. The number of people using check cards is increasing at a very fast rate. In 2012, check card transactions were accountable for purchases reaching over $2 trillion in the United States, and that number only continues to grow.
A check card lets you access the money in your checking account in two ways: Signature-based transactions and PIN-based transactions. With more people using check cards to pay for their transactions instead of cash it’s important to know the distinction between a Signature transaction and a PIN transaction. Each transaction has differences that affect how your money is processed.
When you select “Credit” for your purchase, you are making a signature transaction. It is authorized and completed by credit card companies. Here are some other signature transaction identifiers:
- Many locations may require a signature or ID verification to complete the purchase.
- Transaction may take two to three days before it is processed.
- Cannot receive cash back when you make purchases at most venues.
- Processed over an “offline” terminal.
- Merchant receives money for purchase, typically, within a day or two after the transaction has been accepted by the credit card company.
A PIN (Personal Identification Number) transaction occurs anytime you select “Debit” for your purchase on the point-of-sale terminal. The transaction is cleared through your banking institution. Some other qualities are:
- Requires a four-digit number (your PIN) which is a method of keeping your account safe.
- The purchase amount is taken from your checking account immediately.
- You may choose to receive cash back (funds from your account) when you make a purchase at most retail establishments, usually up to a specified limit.
- The purchase is processed over an electronic funds transfer (EFT) network.
- Merchants receive money for transaction in a few days from the original purchase.
You should always do your best to protect your check card, no matter which option you choose. Memorize your PIN and keep it away from others. It should remain secret. Do not allow a cashier or salesperson to enter your PIN for you, even if they are assisting you in your transaction. If you are shopping online, make sure the site is trusted and secure.
Shopping and banking with your check card is a beneficial way to conduct transactions. Ease, efficiency, and improved accounting are just a few advantageous features. If you have any questions about PIN or signature transactions, we’re happy to help you. You can contact our customer service at 800-247-4418, or visit us at any of our locations.