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Feeling the weight of a U.S. Department of Justice investigation, Visa Inc. yesterday announced a change to an operating regulation that previously forced merchants to favor higher-interchange signature-debit purchases over lower-interchange PIN-debit transactions. To help speed up lines at the point of sale, Visa stopped requiring merchants to secure signatures for Visa check card purchases of $25 or less. However, it continued to force merchants to secure PINs from buyers who paid using the PIN-debit function on their check cards, even if a competing network processed the transaction. Under the new regulation, merchants can waive the PIN requirement for small-ticket and Internet purchases if the PIN debit brand allows such transactions, Gina Talamona, a Justice Department spokesperson, tells ATM&Debit News, a CardLine sister publication. Visa amended the rule in the wake of a two-year Justice Department investigation of supposedly uncompetitive practices in the debit card industry, Talamona says. Approximately 70% of all signature-debit cards in the United States carry the Visa brand, and consumers can use virtually all Visa check cards to conduct PIN-debit transactions, too. The government opened the investigation to determine if Visa's operating rules reduced competition between Visa and such electronic funds transfer networks as NYCE, Star or Pulse, whose PIN-debit brands also often appear on check cards. The Justice Department closed the investigation once Visa voluntarily changed its operating regulation. The agency did not fine Visa, but the government will routinely monitor the brand's actions, Talamona says.

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