The following may be described as disorienting, technical, fictional, real. It is a story of payment, a story that implies many narratives weaving throughout it. Understand it as only one perspective, use it to find your own.
Do you remember that long moment around 2015 in the USA when suddenly we were all being asked to stick our cards into the card readers at bodega, hardware store, and grocery store checkouts? Those months of standing at the register confused, asking the cashier “swipe or chip?” This change is part of an ongoing shift from one payment technology to another. But the shift isn’t singular: we don’t only use cards with chips; we also use ApplePay and Venmo and many other new (and old) money transfer systems. This is a story about those systems, the networks they imply, and the implications for the nature of money –– seen through the points at which we exchange goods and services for representations of value.
I stick my card into the combination pin pad and receipt printer, the classic Point of Sale (POS) I’ve seen at most grocery stores throughout my life –– or so it seems, despite the fact that I know the chip reader I am using now only came into significant use after around 2015. After a moment during which I continue loading my groceries, I notice the machine prompting me to choose between VISA DEBIT and US DEBIT. I click the button next to US DEBIT and am prompted to enter my PIN. I type in the four digit code, attempting to hold my hand in such a way so that the numbers I press are not so evident to the cashier who halfway looks away. Pressing the green button on the bottom right, the enter button which rarely says “Enter” on its face, I watch as the machine ticks over. After a moment it flashes “Approved,” “Remove Your Card” and as I do so the cashier reaches back over to the machine and presses several more buttons, first producing a receipt that she tears aside, and then a second from this same chip reading machine and another from a machine on the side, both of which she hands to me as I am still stumbling to slide my card back into my money clip, a clip which holds only cards.
EMV, so named for its progenitors (Europay, MasterCard, and Visa), is the payment method and standard for credit and debit cards which use microchips embedded in the card to communicate transaction data. These protocols support both contact transactions where the chip is inserted into the card reader, and contactless transactions for both cards and smart devices that use near-field communication (NFC) to communicate with the POS. Instead of transmitting card numbers, EMV uses a system of tokenization that sends one-time codes for each transaction in order to limit fraud.
The EMV chips are loaded with Application Identifiers (AIDs) which tell the POS how to route the transaction. Debit transactions use the bundled US Debit codes, so the cards do not have to be loaded with AIDs for each electronic funds transfer (EFT)/processor network. The transaction information is routed through the merchant’s processor. A network switch then passes it to the customer’s processor. They confirm the transaction with the customer’s bank and send that confirmation back down the chain. The customer’s account is immediately debited, and a payment is processed at the end of the business day, sending money from the customer’s bank to the merchant’s through the automated clearing house (ACH). Each of these parties applies or accepts fees for their role in this process, and there can be more or fewer parties involved, with third parties often taking over specific roles outsourced by the banks, and additional network switches happening depending on the deals between the processors involved.
Some documentation, particularly that from EMVCo, which is the institution that manages the EMV protocols, uses the acronym POI for Point of Interaction as opposed to POS for Point of Sale. This is noteworthy because it widens the discursive space between interaction and sale. It better recognizes the stretched nature of transactions — money and goods moving in syncopated patterns that are kept in time by overlapping processes and standards. Our exchanges at the checkout counter are not synonymous with our monetary transactions.
A surprising amount of information about these layers of transaction lies hidden on our everyday objects of exchange, overlooked or illegible. Most receipts are printed with the AID, and while this only lets us glimpse the edge of a transaction’s path, it is one way of sensing these networks. Or look on your debit card; there you will find logos for Star or Plus or another of the EFT networks, imprints of partnership between your bank and a processor.
Interlink and Meastro are Visa and Mastercard’s processor networks, respectively. These are activated when a credit transaction is made. For me, that was the “VISA DEBIT” option. These transactions travel similar paths to debit, but differ in aspects of liability, cost, and time, among others. Credit transactions don’t require a PIN number for instance, and for the increased risk, Visa (or MasterCard) takes a higher transaction fee. The transactions also take longer to process, giving customers float days where the money has yet to leave their accounts –– a longer period before the merchant is paid. Instead of direct transfers, these card networks transfer the funds through the ACH to their own accounts, and then make a second ACH transfer to the merchant’s bank.
As I am bagging my groceries I pull my card out from my money clip and hand it to the cashier. She slips it into the combination pin pad and receipt printer, one variation on the classic style of POS that is used at most grocery stores. I keep rushing to pack my groceries into the reusable bags I brought, not really paying attention to the rapid button presses the cashier is making. As I finish bagging she hands me back my card with my two receipts, one with my itemized bill and a second thinner receipt that says “Credit Sale” near the top. Below that, the receipt mostly contains acronyms with numeric codes following them. I stuff my card and the receipts into my pocket as I exit. Checking them after returning home has become a habit since starting this ethnography. Previously I either did not bother taking receipts from merchants or I threw them out almost immediately.
The ephemeral nature of receipts has always made me curious as to their function. Sometimes important as proof of purchase when returning items or contacting the company that made a product about a warranty, most of the time receipts are discarded, or they are forgotten in pockets where their thermal printing soon fades from the gloss paper. Perhaps a careful household bookkeeper checks the receipts to make sure they weren’t overcharged, or the receipts are handed over for expense reporting after a company business trip, and the long paper strips grow ever longer with the coupons printed on them to create company loyalty, but for the most part receipts do not seem to be worth the paper they are printed on.
What about the merchant copy? I still watch cashiers tear off the first receipt before handing me my copy, though I never can tell where they set it aside. Credit transactions like the one described above used to require that customers sign the merchant’s receipt on transactions over a certain amount. These signatures haven’t been required by the major credit card companies since around 2018, but there are still merchants who require signatures, primarily as a hold over from when it was required for fraud prevention or otherwise as used by restaurants and similar establishments when collecting tips.
Just as receipt signatures are unevenly deployed, the same is true of the debit card’s other payment technologies. While most cards issued in the US today are EMV compliant, and almost all transactions use the EMV chip for either contact transactions where the card is dipped into the reader, or contactless transactions that utilize NFC to share data between the card and POS, these cards still have magnetic stripes on their back which contain the card information, not to mention the raised numbering on the front that allows for imprints of the cards to be made. This acts as a backwards compatibility mechanism which allows the new cards to work with legacy POS systems, though the liability for fraud on magnetic stripe transactions was placed on the merchants, enforcing the switch to EMV chip readers –– the awkward switch-over this article started with.
David Stearns (2018) suggests that the plastic charge card “may soon go the way of 8-track tapes and VHS videocassettes.” And while it is a medium likely outlasted by cash and subsumed by digital wallets, the choice Stearns makes by invoking these other magnetic tape technologies points to the changing networks around the card itself. As the technology of the 8-track and the magnetic stripe are not dissimilar, it is easy enough to use audio playback equipment to skim data from the card that can be used for fraud. This is also the technology Square used in its meteoric rise. The original device that launched Square was a magnetic head that plugged into the audio jack of a smart phone, allowing the smart phone to become a POS device (Mainwaring 2018; Morley 2010). An easy and effective bridge between legacy magnetic stripes, audio technology, and the quickly digitizing world of smart phones and e-payment companies.
At one of the NYC greenmarkets I am attempting to pay for my produce, the cold winter breeze uncomfortable on my ungloved fingers. I fumble with my card and attempt to tap it against the top of the Square reader in order to initiate payment. After a second tap I give up; it is my first time trying to use the contactless function of my card, a function this particular card might not have as it is a few years old and not all banks are rolling out the feature.
The vendor has taped the slim card reader down to the table and made a cardboard layout of signage pointing to where I should enter the card in order to use the chip in its ‘contact’ mode. The device had been expanded and melded with the table to become some sort of semi-permanent solution for ‘contact’ payment that removes the human handing back and forth of cards and devices. Keeping the customer at arm’s length during a time when contact brings increasing anxiety.
I slide the card into the chip reader and feel the snug fit; but there are subtleties to this sinking-in which I cannot personally detect. From conversations with an informant and observed interactions I know that card readers, particularly those produced by Square, often require that the card enters at the right angle, or speed, or some similar variable. When the transaction isn’t immediately confirmed I have seen cashiers reach over to pull out and reinsert the card into the device, often apologizing for the technical malfunctions. This material relationship between the card and card reader is quite literally one of friction. The force of friction is what holds the cards into the device and provides feedback to the cashier that they have input it correctly, moments before the confirmation lights flash on the card reader confirming the transaction. At this moment however the card reader’s lights are covered by the cardboard holding it down and so I have to rely on the man running the small stand to tell me the transaction has completed as he stares at a smart phone tethered to the table’s wiring. This can be seen as another form of friction, social rather than physical. As our payments move away from touch, touch screens, and keypads towards personal devices and contactless transmissions, our social interactions change. Here the cashier has to confirm the transaction from what they are shown on their screen, at other times, I might be paying with Venmo and the important information we need to share is the username of the merchant. These interactions are a process of negotiating our trust in each other and in the infrastructures connecting us: trust we share that they will be paid and that I have been charged the appropriate amount; trust that the infrastructures work and that we understand them enough to use them properly. There isn’t more or less interaction or trust between the consumer and the cashier/merchant, but there is a shift in social friction, perhaps most evident when encountering changing technologies like the shift from magnetic stripes to chips, and now to contactless taps and payment apps.
My pocket buzzes as I walk away. A receipt was automatically sent to my email. An email I hadn’t provided to this vendor but to another merchant using Square in the weeks prior.
I wasn’t asked for my PIN during this transaction, meaning that it was run through the credit networks, which puts higher costs on the merchants, or in this case, on Square who bundles the cost into a single, consistent transaction fee (“Learn About Square’s Fees” n.d.). For merchants this is at least a stable solution as Square absorbs the difference between transaction types, paying a little more for credit than for debit (and taking on more risk); in turn merchants pay an overall higher cost per transaction.
Square and other payment processors use design to make transactions legible while obscuring the infrastructures behind them. They do this to different degrees, and we can use the concept of friction to talk about the different ways in which we collide with and rub up against those infrastructures. Some companies like Square use design in order to craft a smooth experience for the merchants who are their customers and for the merchant’s customers. They do this through the design of their sleek devices and through the experiences they create with their bundled fees and automatic electronic receipts. Others focus less on their veneer, and we see a little more of what lies beneath –– receipts with codes internal to that particular merchant’s systems of stocking or accounting, prompts and questions about which network the customer wants their card to use.
There are also multiple fictions being created or rather realities. When a debit card is used to make a purchase the banks and card networks merely confirm the availability of funds and validity of the card; the funds are processed at a later time. Or moreover, when an offline transaction is made the PIN number is confirmed by the card’s EMV chip through the merchant’s POS device without informing the bank — the transaction processes when the POS is reconnected to the network. But from the perspective of the customer and the merchant the transaction is complete. Thus there are multiple ontological pathways that can be experienced –– parallel realities between the social transaction that lets me walk out with my groceries where physical goods are traded for the promise of payment and the technical processes that transfer funds between banks eventually reimbursing the merchant. But these realities can smash into each other. When a payment bounces or an item is returned or fraud occurs, who is liable is determined by the method of payment and the networks used. Whether or not I ‘actually’ paid for my groceries is a fact that is subject to future determination.
I used OMNY on New York City’s MTA for the first time while writing this article. Coming out of my conversations with friends and colleagues, the metaphor of the city had solidified as a way to discuss the overlapping infrastructures of payment networks. This crystalized with the MTA, itself an evolving case study of payment technology. Most MTA turnstiles still have a slot in the top that once accepted fare tokens and which, before that, accepted dimes and nickels (Zamir 2011). Now most days I pay with a prepaid charge card with a magnetic strip, which I swipe through a raised reader at the top of the turnstile. But not for long; over the last year or so new, glowing screens have been installed on turnstiles around the city. This is OMNY, a new way to pay for the MTA which relies on NFC technology in your phone or banks card, or at some point in the future, a special MTA card.
I walk up to the turnstile and click repeatedly on my phone’s home button, trying to get the wallet screen up. This isn’t a feature I use frequently, so it is not easy for me to operate yet. Holding my phone near the OMNY screen I press the “Pay with Passcode” button and enter the digits on my phone. As soon as I do so the plastic rim of the screen flashes from its normal soft purple to white and I walk through the turnstile. My phone has a notification. I open it while waiting on the train and read the simple receipt. There are no AID numbers or other information shown, just the time, a line reading “Status: Approved” and my total of $2.75, along with “Metropolitan Transit Authority” written at the top confirming that I had paid the MTA. But I have to wonder, what happens to my transaction fees? Was the Visa network used or the US debit network? These may not be the questions for this essay, but they are important because if the MTA will be accepting all transactions on this singular basis, there will be a shift in consumer’s transaction patterns from putting multiple rides worth of value on their metrocards in a single transaction, to making a separate transactions over the payment networks for each ride they take.
We should also be attentive to who is bearing the burden of these changes. First of all, NFC devices, whether contactless cards or smart devices, are still privileged items available to a subset of the population. Secondly, the MTA has already experimented with incentive programs that reimburse riders who use OMNY (Winston 2020). Thirdly, currently when I load up my metrocard with money for my week’s rides I am not charged a fee for the transaction; however, the MTA as the merchant presumably is. This means that as more riders start using OMNY and thus making more frequent but smaller transactions, the MTA could face higher cumulative transaction fees. This would depend on the deals they have with Cubic, whom they contracted to create and manage OMNY, as well as the card networks and other players in the payment space discussed in this essay, but if there is any form of fixed per transaction fee like with Square and some processor networks or if NFC transactions tend towards using credit networks, then the MTA will end up paying a higher price overall. If the MTA pays a higher price they will have to raise fares to cover it, at the same time as they are subsidizing the rides of the most privileged, wealthiest riders. Thus the fare increase will fall hardest on those who are already most economically disadvantaged.
Expanding from the MTA and OMNY, let me make an analogy out of cities as a whole. Cities –– the old ones at least –– are not frequently planned. They have moments of planning and redesign, but they are the result of historical accumulation –– the piling on of the past that haphazardly remakes and builds on what was there before it, expanding and changing. The parallel running of fiber-optics and phone lines is mirrored by the magnetic stripe and chip, which sit side by side on a debit card. All this to emphasize the complex terrain of payment networks. Like a city built up over hundreds of years, there are layers of infrastructures, not all still in use, not all in communication with each other, each with their own advantages and even more frequent disadvantages –– variously accessible by different groups.
Like Graham and Marvin’s description of divided and classed cities in Splintering Urbanism (2001), payment services are likewise splintered. Speciality charge cards from the Diners Club to the Chase Sapphire create transactional identities (Swartz 2020) that mirror the identities required to access zones of exclusion in the urban sphere. At the same time, payment networks are built upon legacy infrastructures that are constantly being added to, updated, and repurposed. Old sits alongside new in constant cohabitation and conflict.
This analogy extends to regulation. Just as zoning laws dictate the uneven development of the city, standards bodies and payment processors limit and sometimes force the adoption of payment technologies by merchants. Some pay high prices for better real estate or the service offered by Square; others maintain their old buildings or networks but pay for it in increased liability.
A consumer interacting with these infrastructures has similar agency to that which an individual has over the pavement they walk on. The city streets get them to and from work, just as their job pays them through direct deposit utilizing the ACH, and then they pay for their groceries with a debit card which actually runs as a credit charge on the Visa network, debiting the same bank account that their employers paid their wage to. Lives operate on these pathways, and while there are often many ways to get to a destination, the lines we trace with our exchanges are akin to the daily commute: intractable, repetitive, comfortable, and also passing through many toll bridges. Some routes are avoided because of habit, others because of the individual’s particular privilege or lack-there-of, their access to infrastructures.
At the end of the day, this project is an attempt to contrast the lived experience of exchange, and the networks that underlie it. With the analogy of the city I could argue the need for a transactional citizenship. But instead I simply want to prompt further exploration of the systems of payment. By describing the functioning of these systems and their effects and deficiencies I am pointing to their nature as designed objects and suggesting the potential for their redesign. More research is required into these systems of payment, but the bigger question that extends beyond their technical functioning is one of their social role. Through the descriptions of the unevenness of payment methods, both an unevenness of technology and of access and cost, we must ask if the system of banks, payment processors, card networks, and other parties like Square serves the everyday exchanges between merchants and their customers. Are these the exact systems necessary for the functioning of an economy? Can we imagine alternative ways for merchants to be payed? The descriptions made here also emphasize the separate realities that co-exist at these exchange points: exchange between merchant and customer, transactions traveling through card networks and banking institutions. When designing new forms of payment (those that exist now won’t stay the same, if this essay shows nothing else), how can thinking through the separate ontologies of payments and their conflicts help imagine alternative structures of exchange?
This work utilizes fictioning in its ethnographic vignettes. In respect for Jessica Falcone’s (2020) statement “I do not want ethnographic fiction to sneak up on me” I want to be clear that there is that process of obfuscation here, although this work is closer to the ethnographic side of any plausible spectrum between ethnography and fiction. While I am relying on my own auto-ethnographic experiences I have compiled moments from multiple transactions into single fictionalized events written in the italics above. This is done both for narrative effect, compressing many experiences into a single written account, and as a manner in which to anonymize the individuals involved.
As a consumer I only come to these transactions from that particular experience, I have to imagine the experiences of the merchants; and those of the people who have influenced and built the institutional and material infrastructures are even further from my frame of reference. I analyze those realities through the technical and marketing documentation available to me, imagining as best I can the relations the merchant is forced into. If this work was to be expanded, interviews and other forms of sensing could be used to look behind merchant and institutional decisions.
Enough words cannot be written to thank my informants who talked with me about the payment systems they use and answered my obsessed and obscure questions; the same thanks also goes to Professor Shannon Mattern, Ramon de Haan, and the class of Anthropology + Design 2020. Their influence shapes this work just as it shapes me.
“Complete List of Application Identifiers (AID).” n.d. EFTLab – Breakthrough Payment Technologies. Accessed November 30, 2020. https://www.eftlab.com/knowledge-base/211-emv-aid-rid-pix/.
Falcone, Jessica Marie. 2020. “Genre Bending, or the Love of Ethnographic Fiction.” In Writing Anthropology: Essays on Craft and Commitment, edited by Carole McGranahan. Durham: Duke University Press.
Friedman, Allen. 2017. “What Is Common Debit AID and Why Does It Matter?” April 27, 2017. https://blog.ingenico.us/blog/what-is-common-debit-aid-and-why-does-it-matter.
Graham, Stephen, and Simon Marvin. 2001. Splintering Urbanism: Networked Infrastructures, Technological Mobilities and the Urban Condition. London ; New York: Routledge.
Hayashi, Fumiko, Richard James Sullivan, and Stuart E Weiner. 2003. A Guide to the ATM and Debit Card Industry. Kansas City, Mo.: Payments System Research Dept., Federal Reserve Bank of Kansas City. https://www.kansascityfed.org/publicat/psr/bksjournarticles/atmpaper.pdf.
Law, John. 2011. “What’s Wrong with a One-World World.” In , 14. Middletown, Connecticut: heterogeneities.net. http://www.heterogeneities.net/publications/Law2011WhatsWrongWithAOneWorldWorld.pdf.
“Learn About Square’s Fees.” n.d. Square Support Center – CA. Accessed December 10, 2020. https://squareup.com/help/ca/en/article/5068-what-are-square-s-fees.
Love, Derek Edward. 2016. “The Price of Loyalty: Paper Receipts and Their Implications.” SVA MA Design Research. June 2016. https://designresearch.sva.edu/research/the-price-of-loyalty-paper-receipts-and-their-implications/.
Mainwaring, Scott. 2018. “Dongles.” In Paid: Tales of Dongles, Checks, and Other Money Stuff, edited by Bill Maurer and Lana Swartz. https://doi.org/10.7551/mitpress/9780262035750.001.0001.
Mol, Annemarie. 2002. The Body Multiple: Ontology in Medical Practice. Science and Cultural Theory. Durham: Duke University Press.
Morley, Robert E. Jr. 2010. Card reader device for a cell phone and method of use. United States US7810729B2, filed June 10, 2009, and issued October 12, 2010. https://patents.google.com/patent/US7810729B2/en.
Stearns, David L. 2018. “Mag Stripe.” In Paid: Tales of Dongles, Checks, and Other Money Stuff, edited by Bill Maurer and Lana Swartz. https://doi.org/10.7551/mitpress/9780262035750.001.0001.
Swartz, Lana. 2020. New Money: How Payment Became Social Media. Yale University Press. https://doi.org/10.2307/j.ctv10sm94k.
Winston, Ali. 2020. “The NYC Subway’s New Tap-to-Pay System Has a Hidden Cost — Rider Data.” The Verge. March 16, 2020. https://www.theverge.com/2020/3/16/21175699/mta-omny-privacy-security-smartphone-identifier-location-nyc.
Zamir, Monique. 2011. “Subway Tokens: A Dose of Nostalgia.” Untapped New York (blog). July 6, 2011. https://untappedcities.com/2011/07/06/subway-tokens-a-dose-of-nostalgia/.
- For a brief but helpful introduction to EMV and AID see Friedman, 2017 at: https://blog.ingenico.us/blog/what-is-common-debit-aid-and-why-does-it-matter ↑
- For a comprehensive list of AID numbers, see: https://www.eftlab.com/knowledge-base/211-emv-aid-rid-pix/ ↑
- While some of the content is outdated as it is pre-EMV implementation, A guide to the ATM and debit card industry (Hayashi, Sullivan, and Weiner 2003) is one of the most comprehensive descriptions of US payment networks I have found and is what was used for reference for the above descriptions: https://www.kansascityfed.org/publicat/psr/bksjournarticles/atmpaper.pdf ↑
- A surprisingly competitive space, there are a number of companies who produce and/or provide POS devices to merchants such as Retail Tech Inc., Epos Now, and eMerchantAuthority, but the designs themselves are fairly standard and the differences unremarkable (though perhaps sometimes important with companies always working to future proof their product or selling merchants on a vision of the future, as seen in this copy for Merchant Account Solutions’ suddenly pandemic ready devices). ↑
- See Love, Derek Edward. “The Price of Loyalty: Paper Receipts and Their Implications.” SVA MA Design Research, June 2016. https://designresearch.sva.edu/research/the-price-of-loyalty-paper-receipts-and-their-implications/. ↑
- And yet their history influences the ways we conceive of exchange and money. See Receipts in Paid: tales of dongles, checks, and other money stuff (Guyer 2018) and the Museum of Receipts https://www.behance.net/gallery/77024071/Museum-of-Receipts ↑
- See MasterCard’s press release on the matter at: https://newsroom.mastercard.com/press-releases/mastercard-retires-customer-signatures/ ↑
- I still cannot fathom why one particular health food market in my local area insists on running every charge as a credit transaction and requiring a signature. The uneven lag in changeover of devices and processes is itself at the heart of this inquiry. ↑
- Further research would need to be done to determine the exact malfunction in these devices. It seems likely to be mechanical –– like the magnetic stripe reading dongles before them, some devices are simply fickle (Mainwaring 2018). ↑
- This is the same type of ontological multiplicity described in Annemarie Mol’s The Body Multiple (2002). Also see What’s Wrong with a One-World World (Law 2011) at: http://www.heterogeneities.net/publications/Law2011WhatsWrongWithAOneWorldWorld.pdf ↑
- OMNY as a whole deserves its own article researching its political economy and role as infrastructure, but I digress. ↑