Anyone who has ever worked at Starbucks, can you answer me this?

[begin_within]

And it's not, "Why is their coffee so bitter?" That's a mystery that will never be solved. It's about paying with a credit or debit card there. Whenever I have gone their and handed them my card, they have just swiped it and handed the card back to me, and they're done. At every other place I have been, they either run it as a credit transaction, in which case I have to sign a receipt, or they run it as a debit transaction, in which case I have to punch in my PIN. At Starbucks they do neither. How do they get away with this? It seems that they are submitting a transaction with no guarantee of ever getting the payment. If they run it as a credit, there is no signature, thus no promise from me that I won't chargeback or refuse that transaction on my bill. If they run it as a debit, here is no PIN entered, so they aren't verifying that the card is even mine. Why does Starbucks do this when no other retailer or point-of-sale transaction I have been involved with has ever done this?
Thanks

[Midlodemocrat]

1. Fast food places do that as well.

It has to do with the limit of the transaction. Under $15, I believe.

[begin_within]

4. Still, they're taking a risk by not having my signature.

I could contest the transaction on my credit card bill, and because they never got my signature, they have nothing to back it up. So I would win...

[Xithras]

8. Not so quick.

It's my understanding that Visa and the other CC companies imposed some new security requirements along with the removal of the PIN requirement. In order to process a no-pin transaction, a store has to be able to show that it has a security system that can record images of people making purchases. If you contest a bill, they're going to refer it to their fraud department. Contest more than one and you can BET they'll be requesting some tapes from those retailers. Illegitimately contesting a transaction may result in your $20 charge changing into a criminal charge.

Or so explained the manager of the local Taco Bell when I first saw these things in action. They apparently upgraded all of their security cameras as part of the installation.

[begin_within]

10. And that is admissable in court?

[Xithras]

11. Sure, why not?

Security camera footage from stores is used in court trials all the time. If you commit fraud by having legal transactions reversed for your own profit, and security camera footage shows you completing those transactions at the same register, at the same time the original transaction went through, it's hard to imagine why a judge wouldn't allow it.

Keep in mind that most modern point of sale systems are computerized. Every transaction is recorded along with every item involved in the transaction. When a CC charge is processed, the transaction number is sent to them as well. When you dispute a transaction, the credit card company can ask the retailer for a copy of the items involved with that transaction. If the store camera shows you purchasing the exact items involved in a disputed sale at the same time as the disputed transaction at the SAME REGISTER, you're only defense is going to be to argue that some really smart thief not only stole your card, but hacked the stores POS system and video security system to make it LOOK like you too. Something tells me that's not going to fly.

[begin_within]

12. They still have to get a judge or jury to agree that it's actually me on that tape,

and not someone who stole my card. If I were a judge or jury member, I'd be a little wary of purely electronic evidence, which can easily be fabricated, compared to my signature on paper (which of course can be forged, too but that's harder).

[Xithras]

13. I think you're a rare bird in that regard.

Few people question video evidence nowadays, and hiring an expert witness to testify to the ease at which video can be fabricated is going to be expensive. Then you're still going to have to answer the question as to why someone would go through all of that trouble for a charge of less than $25. And how they would get access to the video. And the point of sale computers.

Remember, guilt isn't about absolute certainty, but about reasonable doubt. I could sit on a jury knowing that digital copies can be altered and still find you guilty, because unless there is some compelling evidence that such a fraud DID occur, it's unreasonable to expect that it happened in this case. To buy your argument, I'd have to believe that ALL electronic evidence is fraudulent, and that's going to be a tough sell to just about anyone nowadays. Show me some evidence that it happened, and I'll entertain the possibility. Other than that, this jury member wouldn't bat an eye at a guilty verdict.

[begin_within]

14. What if it was a stolen card that was being used?

Isn't Starbucks taking some risk by running the card through and not verifying that the card is actually being used by the person who that card was issued to? Most places ask for ID now, but at Starbucks they just grab the card and swipe it and hand it back to you. Aren't they putting themselves at risk, if it was a stolen card, because then they would never get the money?

[mondo joe]

22. I'll bet the risk of losing less than $20 every now and then amounts to a lesser $

amount thanthe amount gained by processing orders more quickly.

[mondo joe]

17. They may have done a cost benefit analysis on the risk of people weaseling out of small

charges vs the cost of having people take longer in line.

:shrug:

[LostinVA]

2. Some places around here don't require signatures for credit purchases under a small amount, like $25

[DS1]

3. They ask me if I want a receipt

but I typically decline. So far, they've never screwed me.

I'm fine with the speed. Dunkin Donuts does the same thing.

[JackBeck]

5. Back in the day, over 10 years ago

when I worked at one of two Starbucks in NYC (yes, there was actually a time there were only two) we had to get signatures on CC transactions.

If I were to venture a guess, it would be interesting to see if there was some sort of speed=$$$ equation.

Oh, and fwiw, there are few things I hate more than getting a receipt when buying coffee or smokes.

[GreenPartyVoter]

9. This is for you, then

(and no it's not a rickroll)

Pointless receipts
http://youtube.com/watch?v=uXcGOLwVS14

[Gormy Cuss]

6. It's a new trend.

As others have said, some stores now don't require signatures for small card transactions. I think it's part of the effort to make it easier to use cards than cash, but that's just a guess.

[Xithras]

7. Signatures and pins are no longer required for transactions under $25

The CC companies changed the rules a short while back mostly at the behest of fast food companies who wanted to speed CC transactions in the drive thru. It's not very common yet because the no pin, no signature transactions require an update to the CC machine itself. I was also told that stores wanting to use this must have video cameras on the register too (presumably to help stop fraud). The CC companies do know that small transaction fraud will increase and that they'll be eating some bills, but with the $25 cap they're banking that the losses will be small, and will be more than offset by the increased number of transactions resulting from faster credit card sales.

I don't drink coffee, but I know that Wendy's, Taco Bell, and a few other fast food places are rolling this out fairly quickly.

[NMDemDist2]

15. i can answer the 'why so bitter' question

as I was a competitor to BigBucks

coffee must be used within 10 days of roasting and within 15 minutes of grinding for peak flavor

Starbux's beans are (relatively speaking) very old. this will cause the oils in the beans to go rancid and when the espresso shots are pulled will make it bitter.

:hi:

[begin_within]

16. Thanks... and EWW, that leaves me NO reason to go into a Starbucks!

[NMDemDist2]

19. support your local Mom and Pop coffee houses

they are all Democrats I'm willing to bet

:rofl:

[ScreamingMeemie]

18. I just asked this at CVS (they do that too) and was told that for

under $50, no signature required. Over $50 signature.

[applegrove]

20. I think transaction under $100.00 don't need to be signed re: the credit

card company. That is probably it.

[Gormy Cuss]

21. An article about the change from last year on bankrate.com

It is pretty much designed to encourage use of ccs for small purchases. The article also states that cardholders won't be held liable for fraudulent signatureless transactions.

http://www.bankrate.com/brm/news/cc/20060828a1can.asp

One swipe and you're done

MasterCard recently introduced its Quick Payment Service (QPS), which is essentially a policy change that allows merchants to process low-priced transactions without requiring a signature from a consumer.

It's based on a floor price depending on the type of industry: $25 at convenience stores and fast food restaurants, $35 at drug stores and movie theatres and $50 at parking garages and service stations. Nagesh Devata, vice-president of acceptance development and product solutions at MasterCard Canada Inc., in Toronto, says more than 20,000 merchants have enrolled in QPS since its launch.

The simple process change makes buying something a two-step transaction compared to the five steps it used to take to use a credit card and the six steps it used to take for a debit card. Now, the card is simply swiped and handed back to the consumer. Before, there would be a swipe, a wait for an authorization, the printing of a receipt, the signing procedure and the handing back of the card. "Overall, what we are doing is making the checkout process more efficient," explains Devata.

Visa has a similar policy. Mike Bradley, vice-president, new products and platforms, for Visa, in Toronto, says the company has also introduced a "no-signature-required policy," for the small-payment segment covering fast-food restaurants, video stores and parking garages. "The card holder doesn't have to sign," so there's no "fumbling around for pens and messing around with paper," he says. It also means retailers don't have the same administrative headaches and no longer have to file a paper receipt of the transaction with a signature.