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Pay at the pump is a system used at manyfilling stations, where customers can pay for their fuel by inserting acredit card,debit card, orfuel card into a slot on thepump, bypassing the requirement to make the transaction with the station attendant or to walk away from one's vehicle. A few areas have gas stations that useelectronic tolling transponders as a method of payment, such asVia Verde in Portugal.
Pay at the pump was first invented in 1973 by George Randolph “Randy” Nicholson (1937 (1937)–2020 (2021)), debuting at an E-Z Serve gas station inAbilene, Texas, but did not take off until the 1980s.[1][2][3][4][5] The system was introduced in 1982 in Europe, andMobil later claimed to have been the first gas station to introduce pay at the pump in the United States in 1986.[6][7] Only thirteen percent of convenience stores had the technology by 1994. Eighty percent of US convenience stores used it by 2002, and virtually all US stores do today. In 2004,Sheetz was the first to use touchscreen kiosks by the pump, where customers can also order in-storefoodservice items that they pick up after fueling.[8]In 2012,Zarco USA was the first to have ordering touchscreens on the pump.[9]
Pay at the pump is seen as a way to keep thecost of gasoline down by reducing the need for employees at filling stations.[10] It is considered to be a major change from the days in which full service was the norm at filling stations, and the attendant not only pumped fuel, but also washed thewindshield and checked the fluids andtire pressure, all while the customer remained in the vehicle.[11] Full service is legally mandated in the US states ofNew Jersey and parts ofOregon. Oregon allows for commercial self-serve of gasoline for business use[12] through a cardlock network, such asPacific Pride or CFN.
The technology has also allowed the introduction of unattended filling stations (where allowable by law), which are mainly outside supermarkets and other retail establishments and have no connected store facility.[13]
Those who use the pay at the pump feature could be putting themselves at risk for fraud, as thieves can attachskimmers to the pumps that can steal the information off the cards used to make purchases.[citation needed] Many debit cards can be used to make the purchase either as debit or credit. But those who make the purchases as debit are potentially feeding their information into the skimmers.[14]
Without the human interaction, there is no verification system when credit cards are used to make purchases, and no signature is required. This enables those in possession of stolen or cloned credit cards, or those who are otherwise making unauthorized use of another's card to purchase gasoline without a signature. Many stations now require customers making credit-based transactions to enter theirzip code (United States) or equivalent (other countries) in order to be allowed to make a fuel purchase.[15] The security of credit card numbers on receipts has been nearly nullified, as the vast majority of retailers nowtruncate to only the last four digits of a card on a receipt, with legal force in many states and provinces.
In the United States,EMV chip card acceptance at gas pumps was part of the liability shift, where the entity that does not comply with the chip card upgrades will be liable for any fraud. The liability shift was originally set to be at October 2017 but was moved to October 2020 by all payment brands, and later the payment brands extended the liability shift to April 2021.[16][17]
The vast majority of gas pumps with pay-at-the-pump capabilities will place a temporary hold on a certain amount of money, generally $75-$150, in a customer's account following the use of a debit or credit card to make a purchase. The pump must do this pre-authorization before allowing a customer to pump fuel to guarantee funds are available to pay for said fuel. The length of time the funds are placed on hold, and are unavailable to the customer, is totally dependent on how fast the customer's bank processes the transaction.[citation needed] Depending on the bank, it can take a few minutes to a few business days before the funds on hold are released.
While this amount is placed on hold, the customer could be penalized fornon-sufficient funds when making other purchases on the same account.[18]
To avoid pre-authorizations and holds placed on their accounts, customers can pay for fuel inside the gas station and not use pay-at-the-pump services.
Paying at the pump may lead to customers avoiding going inside aconvenience store and purchasing snacks, beverages, tobacco, or automotive products, thereby hurting the profits stations make from such sales.[19]
Some gas pumps have been upgraded to offer contactless payment, where mobile wallets likeApple Pay andGoogle Pay are accepted, as well as mobile features to pay at the pump online, without interacting with the pump for the payment, by identifying the pump number in the mobile wallet and charging the card stored in the wallet.[20][21]
Amazon also offers pay with Alexa at selected gas pumps.[22]