US supermarket chain Kroger has filed a case against Visa for allowing customers to verify EMV transaction using a signature instead of a PIN.
Filed in US District Court for the Southern District of Ohio, the lawsuit also accuses Visa for threatening to increase fees for processing debit transactions and to eliminate Kroger’s ability to accept all Visa debit cards.
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The grocery chain said the dispute started after Visa informed the company that the configuration of its new terminals did not comply with Visa’s rules.
Kroger further alleged that Visa forced the company to allow customers to verify purchases with a signature instead of a PIN and Visa fined the retailer $7m when it did not change its practices.
"Visa further demanded Kroger to re-configure its terminals to remove the required and more secure PIN verification, and to use a Visa "application identifier" that would force a given Visa debit transaction to be routed to Visa for processing, regardless of whether the cardholder used PIN or signature to verify the card," Kroger said in the lawsuit.
The retailer said that the acts of Visa will be catastrophic for its business as it processed $29bn in Visa debit card transactions last year.
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By GlobalData
