In a fascinating article on the credit and debit card industry, the New York Times looks at a little-known aspect of the card game: The differing fees imposed by card companies--Visa is the big gorilla--when customers use them to make purchases.

Basically, when a customer signs for a purchase, the store pays the bank four times as much as when customers punch in their four digits. So lots of big companies, such as Wal-Mart, steer customers to use their pins. Signature remains the main form of purchase however. But the reality is that no matter which form you use, the banks win because the card companies have kept on hiking the fees that merchants pay the bank. Some find this a "perverse form of competition." As it creates competition by card companies to raise the fees that banks get. This is a separate issue from the interchange fees, which typically generate so much more controversy. 

For more:
- here's the New York Times article

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