Kroger Sues Visa Over Pin Debit Transactions

Kroger Co. filed a lawsuit against Visa Inc., saying the payments network has threatened to raise fees and cut off the grocer's acceptance of debit cards due to a dispute about the use of personal identification numbers to verify debit-card transactions.

Kroger said it has already been fined $7 million by Visa over the dispute. This has been ongoing for several months and is tied to the introduction of safer cards that have an embedded computer chip instead of the traditional magnetic strip.

Kroger required customers to authorize their chip debit-card transactions with a PIN and routed the transactions to networks other than Visa. The grocery chain said that Visa said the configuration of its payment terminals didn't comply with Visa's rules and demanded that it route the transactions only through the Visa network.

Kroger says it rang up $29 billion in Visa debit-card transactions last year, noting in the lawsuit that cutting off its ability to accept Visa debit cards "threatened catastrophic consequences for Kroger's business."

The lawsuit was filed in U.S. District Court for the southern district of Ohio. A Visa spokeswoman declined to comment.

Wal-Mart Stores Inc. also sued Visa over PIN debit transactions last month.

Write to Robin Sidel at [e-mail]

(END) Dow Jones Newswires

June 27, 2016 13:45 ET (17:45 GMT)

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