8. EFTPOS

EPOS tills allow their customers to pay for their shopping using a debit or credit card instead of cash. (EPOS = Electronic Point Of Sale)

The money has to be taken electronically from the customer's bank account and paid to the supermarket's account. This process of moving money is called Electronic Funds Transfer at the Point of Sale or EFTPOS.

chip and pin

Embedded within the credit or debit card there is a a tiny electronic chip that holds the card details and the secret PIN number that only you should know. The card is inserted into a 'Chip and Pin' machine and you key in your PIN. At that point, an automated request for approval is sent to the bank computer via the telephone network.

The bank computer checks that there is enough money in the account to complete the purchase.

The 'Chip and Pin' card is common in the UK, but you may notice that there is a black magnetic stripe on the card as well. Other countries use magnetic stripe readers to carry out the purchase.

 

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In order to improve security, the bank / credit card computer also checks to see if the card has been reported as stolen. It will also check for unusual spending behaviour when using that particular card to spot possible fraudsters. For example, if that card is used 100% of the time in Leeds and now it is being used heavily in London, it may ask the customer to prove their identity at the shop.

If everything is fine, a message is sent back to the EPOS unit to authorise the purchase and funds are transferred from your account to the merchant account.

 

Challenge see if you can find out one extra fact on this topic that we haven't already told you

Click on this link: Chip and PIN