In message , at 16:55:37 on Sat, 25 Feb
2012, Stephen Sprunk remarked:
There's some over-simplification here. While I agree that some retailers
(especially high-margin ones like restaurants) may not require a
signature, there's a second floor limit above which they have to call
the credit card company. That limit seems to me to be much lower than
you'd get in the UK for a similar transaction verified by PIN.

By "call the credit card company", do you mean actually speak with a
human, or just do a standard automated authorization?

With a human.

Perhaps I just don't spend enough money to run into that ceiling, but I
regularly charge amounts up to ~USD 3k.

My bank does periodically call me /after the fact/ to verify atypical
transactions, but merchants never see that: their authorization goes
through normally.

Like I said before, I had a $300 transaction in the USA which resulted
in the retailer having to make a phone call, and subsequently asking me
for ID (which I thought wasn't allowed, but there you are). After the
transaction went through, my bank tried calling me to verify that it was
OK, but by then it was the middle of the night and it went to voicemail.
I spent much of the next day working out how to collect my voicemail
from 'overseas' (I'd just switched mobile service).

The occasional machine, e.g. at gas stations, wanted to know my home
zip code (which, of course, I don't have) but I was able to pay in
the kiosk. (US gas stations need payment before dispensing fuel,
rather than afterwards, as in the UK.)

There's some over-generalisation here, it depends where you are in the
USA; some places need payment first, others don't. It depends a little
on the local demographic.

More specifically, it will depend on the drive-off (i.e. theft) rate at
that location or in that neighborhood.

And you can't predict that by the demographic, of course.

Was that sarcasm?

Indeed. I used a gas station in the bad part of town (here in UK) this
week, and I've never seen one with so many notices saying it was an
offence to drive off without paying (even then, they were using
post-payment).

Yes, there are many demographic factors that correlate well with local
crime rates, and a customer can fairly accurately predict (from a brief
look around the area) whether prepayment is required at a gas station.
However, card processors don't care about demographics; they only care
about chargeback rates.

Notably, certain industries (eg. retail electronics) are known to have
high chargeback rates regardless of demographics;

And your hypothesis is that stolen/skimmed cards will turn up equally
likely in retail electronics outlets in the good and bad parts of town?

others (eg. fast food)
are known to have low chargeback rates. As a result, merchant policies
vary in ways that are _not_ consistent with demographics.

Of course the policies can vary according to more than one metric. The
type of retail and the location both play a part.
--
Roland Perry