Restaurants May Use Portable Credit Card Readers To Prevent Identity Theft

Portable credit card readers have the potential to make your dining experience safer and faster. The portable readers make it unnecessary for customers to hand over their credit cards, preventing waiters from stealing personal information with skimming devices. Up to 70% of skimming scams take place in restaurants.

Pay-at-the-table systems are popular in Europe and other parts of the world, but they haven’t yet caught on in the U.S., largely because equipment makers have been unable to point to a reason restaurateurs should invest in the gear.

Manufacturers now see an opportunity. A rise in the number of “skimming” scams in which waiters use hand-held computers to steal customers’ credit card information and sell it is creating a sense of urgency. So is a push by managers to speed the flow of diners during peak hours.

The portable systems also save customers the trouble of calculating a tip by adding an option to automatically add 20% to the bill. We like the idea, but some find the experience underwhelming:

Wayne Smith and two friends had just scarfed down three steaks and were waiting for the $191 bill when his waiter plopped down the machine. He scanned his card, touched the square denoting a 20% tip and waited for his receipt.

“I feel a little like I’m at Wal-Mart,” Smith said.

Plastic may be next on the plate [AP]

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  1. Tombfyre says:

    I’ve been seeing the portable machines showing up a lot lately in the downtown areas of the city. I’ve yet to have one get handed to me in an actual sit-down style establishment, but they’re already popping up all over the quick lunch-box places, coffee shops, etc. I think they’re a great idea. If nothing else, it lets me be in controll of my cards, and is one less thing with a cord in the way of everything else.

    I’m less concerned about servers trying to steal my card information, than I am about them just forgetting to give it back all the time.

  2. banned says:

    20% tip is outrageous. I pay 15% for great service, 10% for poor, no more, no less. Sounds like a scam so waiters make more tips and the restaurant still gets a cut.

  3. Jeff says:

    I thought these were great when I was in Europe. It saved a lot of time. You only have to get the attention of the waiter once, rather than first to bring the bill, second to come back and get your card, and third to ring it up.

    Having this in the US would have avoided the time a restaurant gave my friends card to another table, and they walked off with it. Or the time they (different place) mysteriously lost my card between waiters.

    I’m all for it.

  4. V-effekt says:

    @rocnrule: Never worked in a restaurant, have we? Yes, it is a big scam so servers can get RICH beyond belief.

  5. FLConsumer says:

    They have them in the UK, quite nice, *BUT* a Brit TV show demonstrated just how easy it is for waitstaff to use skimmers, even with these in place. Granted, it takes a bit more skill.

  6. mopar_man says:

    “I feel a little like I’m at Wal-Mart,” Smith said.

    Am I the only one that doesn’t get the reference there? How does a portable card machine feel like Wal-Mart?

    Personally, I like those portable machines. You get your purchase rung up much faster. I’ve had places where the waiter/waitress has run off with my card for 15-20 minutes.

  7. Falconfire says:

    @rocnrule: Actually its more to do with local. East and west coasters where cost of living is much higher tend more toward 15-20% tips. Middle America I noticed tend toward 10-15% unless your from a bigger city.

    As for scam? The only scam is our government who lets these restaurants pay less than minimum wage in the first place. Tips are supposed to be a reward for good service, not the paycheck for these people. I know with my fiance, when she still worked for Mac Grill, if she got a few tips less than 15% she lost a lot of money for the week. Likewise the tip is extremely subjective. I have seen people wait hand and feet on someone and get a 5% tip from some asshole who didnt have enough money to even be where they where in the first place.

    Its a lot to be said that only America still “tips” for the most part. Most places in Europe, Canada, and Mexico REQUIRE you to pay gratuity. Its actually why they love Americans, because they often dont read their bills and tip on top of the mandatory gratuity.

  8. misterfancypants says:

    Seems like this would open up other security holes, as the portable readers (I would guess) would be transmitting the data over wireless networks.

  9. Employees Must Wash Hands says:

    @mopar_man:

    Am I the only one that doesn’t get the reference there? How does a portable card machine feel like Wal-Mart?

    I’m guessing because you’re getting a credit card terminal put in front of you, rather than a tray with some mints? Honestly to me, both are pretty impersonal, with the mints just there to dress up the fact that they’re telling you it’s time to pay up.

    My first day visiting Paris in 2000, I saw a waiter bring out a portable credit card terminal to a patron’s table. The patron slipped his smart card-based credit card into the reader, punched in a PIN, took a receipt and got up to leave. It seemed stunning to me that we didn’t have anything so incredibly simple like that in the US.

  10. enm4r says:

    A mandatory gratuity doesn’t make any sense for small parties. It’s supposed to be a way to entice good service, not a mandatory fee to using the waiter’s time.


    I agree about the minimum wage though, I would hope all states have laws set in place to say that if you don’t make enough in tips to cover at least what you would have made with min wage, the company makes up the difference. That said, most of the servers I know made pretty good money, relative to the work they do. This might not always be the case, but comparing my college job to theirs, it was about on par for the work/time involved.

  11. banned says:

    @Falconfire:
    No arguements that the servers should be paid more. You are wrong however in that Canada requires tips. I live there and only a few restaurants do include tip in price, but you are still not REQUIRED to pay that. We have the same freedoms as you, including the freedom not to tip.

    @veffekt:
    Actually I have worked in a kitchen and I have no issue, but the restaurant does in fact take a percentage of those tips, so more tips means more money for them.

  12. Hoss says:

    I’m not getting it — wouldn’t it be very easy to capture credit card information from wireless devices?

  13. Falconfire says:

    @enm4r: Well you also have to figure out what your tipping for. Many Americans falsely assume your tipping for JUST the waiter, when in truth for most places your tipping EVERYONE involved in your experience.

    I know at Mac Grill, your tip is split among the cook, food runner, waiter, and bartender if a drink is involved. 8% is not a lot at all when its split among 4-5 people, which is what the IRS considers a standard tip.

    Now by law, restaurants are supposed to supplement wait staff’s pay if less than 8% of their pay is made up by tips. But its not enforced at all

  14. yg17 says:

    @Hossofcourse: Nah, it’s probably encrypted. I doubt it’s any more dangerous than you buying stuff online with your card while on an encrypted wireless connection.

  15. easy2panic says:

    Well, it won’t help much for those who really want those credit card numbers. More than a few months ago I saw this video done by some British people showing how different ways a waiter or waitress can steal the credit card number and see the pin by using a portable device. There were a lot of ways.

    So if your waitress “accidently” drops your credit card or it looks like she is having a love affair with it around her waist (a quick swish of the card), that is all she needs with her own scanner which you can easily find online for 10 or more dollars.

  16. Falconfire says:

    @rocnrule: Thats interesting, because I know someone who had the police called on him in Montreal for not paying it. They said if its on the bill you must pay it and threatened him with jailtime for skipping out on the bill.

    I myself have never been to a place in Canada who has not had not only the tip put in, but a line under it that said you where required by law to pay it. I have only been in Quebec and Ontario providence though.


    My friend BTW was a asshole, he was not paying to prove a point. He ultimately paid it when he was called out on it.

  17. homerjay says:

    @Falconfire: I feel bad for the people behind the scenes who get to split the tip with the waiter but the bottom line is that people tip their waiter. If the waiter sucks and all those other people get shafted because of it, its not the customers fault- they should take their agressions out on the sucky sucky waiter.

    I have a small ‘greasy spoon’ type diner that I go to weekly for breakfast with my family. I love the people there. Nobody can beat their speed and efficiency and I consistently give 30+% tips. If I’m getting full breakfast for $15 for three people, I just give her $20 and they notice every time. I’ve been doing that for 10 years.

    Conversely, I’ve paid the exact amount on the bill several times when the waiter/waitress totally totally sucks.

  18. banned says:

    @Falconfire:
    Maybe your right in Quebec but they don’t count, lol. They’re french, what can you expect, thet’re total assholes! They charge Non-Quebec citizens a foreigners tax on gas. Think of it as more of an englishman’s tax. After some research, it happens in both Canada and US, typically on groups 6 or more, but has to be written somewhere so you know. Your friend probably couldn’t read french.

  19. balthisar says:

    These things are friggin’ fantastic! There’s only one place I know of in North America that uses them — Lucy’s Seafood Kitchen in Mississauga, Ontario. It’s a local chain there, so presumably the other locations use them too. I spent a year there on a business trip, meaning many, many restaurants. Only this place used the machines. There was no option for an automatic tip, though, but it doesn’t take a lot of thinking to leave a decent tip.

    One thing I’m still not sure of after a year there: what’s an appropriate tip in the Greater Toronto Area? I’m told that waitstaff make an actual living wage, so presumably one could/should tip less than while in (for example) SE Michigan. Since I was on a per diem anyway, I always tipped 15%-20%, and our favorite waitress got to know us and what we wanted to drink as soon as we showed up, so I’m guessing she wasn’t upset with that amount.

  20. banned says:

    @balthisar:
    In Canada, its %10 for poor service and 15% for good service.
    [www.toronto.com]
    This is slightly outdated as sales tax is 14% now, was 15% so paying equal to tax is slighly under par.

  21. bigvicproton says:

    here in europe these machines cost about $2000 each. they also tend to fall on floors and disappear.

  22. Falconfire says:

    @rocnrule: wow 14% tax… god that must suck. People in NJ where bitching when ours went from 6 to 7.

  23. homerjay says:

    @rocnrule: WHY would you give 10% for POOR service!? Poor service deserves nothing. NOTHING. A tip is a reward for good service not payment for food delivery. Thats built into the price of food.

  24. banned says:

    @homerjay:
    I do not argue your point except to say that it is not always the servers fault your order was screwed up, it is usually the fault of the cook. Also, servers are people and have bad days. When you have a bad day at work, does your employer pay you less? Unless your salary is commission based, then likely not. If service is horrendous, I won’t tip, but if its slow, or not with a smile, or the food is cold, etc, then 10% is enough of a statement. If you really want to make a statement, then leave pennies, worse than no tip at all. These people do make below minimum wage, far below the poverty level. The tipping debate is however, a whole other thread. Either way, tips are a personal feeling and they rest on your own conscience.

  25. Bryan Price says:

    No skimming. Now we have somebody cracking the WiFi to get all the information.

  26. dantsea says:

    Oh, boy! A Consumerist post combining tipping, debit/credit cards and wireless technology. I think you got the trifecta, Carey! :)

    Anyway, my favorite Chinese delivery place in San Francisco uses the mobile version of this. No need to type in my credit card number in their online form or say it over the phone. It’s a nice convenience.

    From what I’ve read, the terminals don’t transmit credit card information in the clear; it’s encrypted. Probably won’t assuage the wireless paranoids in the audience, but I’ll take my years of fraud-free experience over quivering fear of what might happen, thanks much.

  27. Portable readers won’t deter clever thieves. Here’s a video that shows how they can still skim your card right under your nose:

  28. Mike_ says:

    According to this previous Consumerist story, it will do little to help.

  29. Thrust says:

    Re: The portable Machines

    I used to deliver pizza, and these machines were the best thing to happen to that industry. For both the company and the consumer, this reduced fraudulent charges and made life easier. No more taking creditcard numbers over the phone, thus security for the customer, and running the card through the machine will alert an NSF/Invalid purchase at the door, instead of when the driver is back at the restaurant, thus safter for the business. Win Win. PLUS it added the option to pay debit to the business which both sides love.

    Never seen these used inside a restaurant though. I never pay with creditcard so skimming in a restaurant is less of a worry for me, and debit you have to be with the server to do so again no worries.


    Re: Tipping

    Don’t be so cheap!
    Tips make up more than half of a server’s income. They DO need the gratitude of customers to get by. And it’s not just them, all the cooks and servers get portions of their tips to cover how hard THEY work.

    As long as the service is alright, I’m usually in or around 20%. If the service just blows I have no problem not tipping the server, but if I don’t tip her, I approach the manager on duty and give him the tip to spread amongst the kitchen since it’s not their fault.

  30. TechnoDestructo says:

    @Falconfire:

    If it’s a mandatory charge, why is it not included in the price of the food?

    Or is there a fixed minimum in addition to a percentage?

  31. I hate how restaurants still have the older style credit card terminals (the full copy with your entire # is printed on their copy of the receipt along with exp. date and name)

    While the copy you get has the CC# X’d out until the last 4 digits is pretty safe, the copy the restaurant keeps (with all my info exposed) makes me really weary.

  32. 12monkeys says:

    I really like the idea of portable readers.Service is faster, and faster service = bigger tip.

  33. Ponygirl says:

    @rocnrule:
    20% is considered standard now a days. Wait Staff make less than 3 dollars an hour because the restaurant industry claim tips make up the difference. Having plenty of friends in the industry (especially when I was in the kitchen in New Orleans) I can tell you that your 15% doesn’t leave the waiter/waitress with much after s/he pays out the host, buser, bartender, etc. A tip is what they depend on for aliving wage. Think about that next time you begrudingly dole out your 10-15%

  34. Ponygirl says:

    @Ponygirl:
    Rocnrule, I see you have already addressed this topic. Move along.

  35. stasi says:

    The title of the post is incorrect. Portable POS terminals DO NOT prevent ID theft, just credit card fraud and/or skimming. ID theft and credit card fraud generally don’t go hand in hand, it’s typically one or the other. Many seem to get these two mixed up when there’s a clear difference.

    ROCNRULE, that 10-15% tip is really cutting that waiter of waitress short. As PONYGIRL said, 20% seems to be the standard.

    DISCOUNTEGGROLL, don’t hesitate to scratch out the everything but the last 4 digits of the account number. If they question that, just advise you have concerns with regard to fraud.

  36. homerjay says:

    Last I checked no one is forcing anyone to take this job. Just like any other (non-union) job- if you’re good at it, you’ll make more money. If not, you should get another job.

    Its not my fault that the waitstaff is required to split their tips with everyone else that works there. I don’t know whether or not the problem lies with the waiter or with the cook because no-one tells me. Therefore, I am left to make a judgement call.

  37. Jiminy Christmas says:

    homerjay:

    Do the world a favor and just eat at home.

    In states where other laws don’t apply the minimum wage for tipped workers is $2.13/hour. Personally, I wouldn’t piss on someone if they were on fire for $2.13/hour.

    Servers are further screwed by cheap bastards who don’t tip in the following manner: Lots of restaurants are using a relatively recent method for calculating tax withholding called attributed tip income. Basically, the employer withholds taxes based upon a percentage of gross receipts.

    So if a customer gets their undies in a bunch and leaves a 5% tip, and the employer withholds assuming a 15% tip rate, the server had better maintain scrupulous records of their tip income or they will personally eat the difference until tax filing rolls around. Ergo, the server’s wage is not “included in the price of the food.”

    Lastly, if I were you I wouldn’t return to restaurants where you have left a tip in the 0-10% range. If you do, hope that no one remembers you.

  38. wring says:

    absolutely unnecessary. also, if you’ve ever been to a ring-it-yourself stand, half the ppl who use them never know what they’re doing.

  39. doctor_cos wants you to remain calm says:

    I’m wondering where they’re going to put this thing down for us to use it! Most places I’ve been to, the table is small to begin with, then you have plates and glasses and stuff all over the table, good luck finding a clear spot near the designated purchaser!!
    And tips are based on merit. Having worked on the other side of the counter in a previous life, I typically tip well unless service is completely shit. Then I tip normally and complain. But you have to really piss me off for that to happen.
    And folks who think they’re getting bad service need to gauge that on how busy the place is at the time. Even the best waitress/waiter is only human, so be nice, children.

  40. banned says:

    In defence of myself, I was unaware 20% tip was the custom in the US. It’s 15% in Canada and thats all I have to go by, so when I am in the US, I will be sure to remember to tip more. That being said, those machines will inevitably make their way to Canada, and I doubt the auto tip button will be adjusted for our customary 15%. Thats where I take issue. As for the servers, maybe they make more base salary here, $5.85/hr vs $6.85 min wage, and it seems over there they make just over $2/hr. With our dollar over $0.95 American, our servers make almost double yours, but our retail prices are more expensive so I’m not sure how the math works by years end.

  41. WV.Hillbilly says:

    20% is considered the standard by who? Waiters?
    It’s unskilled labor, you’re lucky to have a job.

    People tip 20% because they’re too stupid to figure out 15%.
    They just move the decimal point on the total & double it.

  42. Thrust says:

    Canadian law forbids the paying of less than minimum wage, even in the case of tip-driven industries. Any server who is getting any less than that province’s minimum wage because she earns tips is being ripped off and should complain to the labor standards board. Sadly, waitress is the single largest job for employee rights violations, second being gas station attendant. Being deducted for dine’and’dash is illegal, paying less than minimum because of tips is illegal, and there are VERY few legal ways to deduct from a server’s tips (only way I know is the cut for the kitchen staff, but there is no cut for the restaurant/manager/company).

    About the machines. I have not seen a terminal that prints the entire card number ever since everyone switched to high-speed. If there are still some out there (up here) they would be more in places that aren’t big chains (like Chinese food or local pizzarias). Haven’t seen any pre-set 20% models, ours are nicer. The new model phasing out the old machines has three buttons below the screen. Tip %, Tip $, and No Tip. Punch in what you wish to do, a dollar value, a % or go king cheapass.

  43. homerjay says:

    @jrford8: You may be misreading me. I am hardly a cheap bastard. I regularly tip 25%+ for servers who deserve it and most of them do. But the ones that dont get zero. I can’t remember the last time its happened, but its not my fault if they suck at their job. I am not demanding, I am not a pain in the ass, and I CERTAINLY don’t go back to a restaurant where I felt I had to tip 0% because the service clearly sucks.

  44. RebekahSue says:

    i love this! i just had to destroy a credit card when my information was stolen. I’m not sure at what point this happened – was it during a purchase? at a restaurant or a store? Did a cashier take a picture of my card with his cell phone? was it a guest in my home when my wallet was in my backpack and i had gone into another room? Chase has said that they “cannot” tell me who did it. (I’ll snail mail them tomorrow to ask why the hell not.) @rocnrule:

    20% tip is outrageous. I pay 15% for great service, 10% for poor, no more, no less

    I’m not sure where you’re from. I know that tipping isn’t customary in Europe. In the United States,

    At restaurants, a 15% tip is standard for waiters; up to 20% may be expected at more expensive establishments. Good service is expected, and it is sometimes acceptable for a tip lower than 10% to be applied for ordinary or unsatisfactory service.
    - Fodor’s – Tipping Guides

    The salary of wait staff in the United States often starts at HALF the Federally mandated minimum wage, because the tip, which is supposed to be claimed as income, makes up part of the salary. Don’t like it? Don’t bitch to the restaurants; bitch at the U.S. Department of Labor. My tip starts at 15%. Exceptional service will receive a tip as high as 30%. (When we ate at Denny’s, we tipped high because we knew that “our” regular waitresses shared tips with the mentally-challenged busboys, who made minimum wage.) The lowest tips I ever left included McDonald’s coupons (bad service at Friendy’s when I was in high school), and 25¢ to the waitress at the post outdoor Greenwich Village restaurant who ignored me and lavished attention on my date (she forgot my drink, she forgot my meal) until she realized that I was paying, for his birthday, and she then brought an illegible credit card slip and refused to reprint it, which made me suspicious as to what the charge actually was. But, generally, I triple the 6% sales tax and round up to the next dollar. Was it here on Consumerist or on another site I frequent (I think it was here) that it was suggested that, on the credit card tip line, if you’re tipping cash, you write TABLE or CASH so that the wait staff knows where the tip is, but no one can write in a figure that would, essentially, add to the cash tip one had already left.

  45. suckonthat says:

    While others have said it well, I’d like to add to homerjay and others who think that tipping nothing is acceptable: you would never ever do this in any other industry. If someone spent a half hour (total, averaging) getting your food to you, as in the job was actually done despite any attitude, I think you are ethically obligated to pay them something. 10% and/or a discussion with the manager is my way to go. If you were to hire a painter for your house (“unskilled labor” as hillbilly so condescendingly called it) and you didn’t like his attitude and didn’t think he did an “above and beyond” job – but he did it, your walls are covered and not patchy or damaged – you may not pay him as much as he originally asked for, BUT YOU WOULD NEVER STIFF HIM.

    Waiting tables is hard as you get treated like a stupid servant by at least one table a night. I don’t know that I have ever worked a job so exhausting. Am I advocating making waitresses incredibly weathy, god no, I am just saying that everyone deserves to get paid for their job, whether they do it with smiles and grace or with a grimace and an eyeroll.

    If you have that big of a problem with paying for service, most resturants have take-out now so you don’t have to participate in the system.

  46. Thrust says:

    People, don’t be cheap. Tip servers well because they are the people busting their asses doing the jobs you don’t want to do, and they probably don’t want to either but they need a paycheque like everybody else.

    I did pizza delivery for a couple seasons, and let me tell you… People who I knew to be good tippers were typically also the nicer people to deliver to. It’s a double bonus, good compensation for busting my ass, and they’re friendly people I wouldn’t mind busting it for. Then you get the ones that don’t tip well, who vary from friendly to downright rude. Last come the real pricks. The kind of person who doesn’t tip is also the same kind of person who looks at delivery staff (or waitresses, etc) as less than human. These are the rude customers who would try and stiff the driver, always phone to complain about delivery times, the food, or just because they want to. You know that whole Karma thing? Well I had three known total assholes who wouldn’t tip, treated me like shit, and complained a lot. One of them pushed me so far that they were taken off our map, the other two, I would take up to four orders that were BEHIND them, first.

    Now the nice ones… I could point to their houses on a map and tell you their first name at least, sometimes their surnames too. There were five of six of them that were good tippers, one which didn’t tip much because she couldn’t afford to but was still a real nice lady. Any of these six would be bumped ahead of orders even on the busiest of nights.

    It’s simple. Five bucks and a smile meant getting the order treated like a VIP’s, where no tip or cheap tips and a frown meant extra waits of 45-60 minutes. You choose what you prefer.

    Oh, a sidenote on pizza delivery. Drivers must supply their own vehicle, which has expenses all of its own, pay their own gas, and most (I’d say 4 of the 5 largest chains) are ONLY paid by the order (usually around $4 per delivery) plus tips. Back when I did deliveries, my own speeds within my zone let me run 4 orders per hour if taken singly back-to-back with no down time, or 6 per hour if taking two at a time same deal. Say average of 4 deliveries in an hour, earns $4 per, that’s $16. Gas averaged at around $1.25 per, so now you’re at $11 per hour (if it’s constant). From that I still have the wear and tear on my car and cellphone minutes used for the job (Call it $3), making it down to 8/hr. Now the night isn’t going to be constant, so it usually works to about half downtime. So now without tips I’d make a measly four bucks an hour. Without decent tips, I’d often call the night right after dinner rush because if people are going to be cheap, they can pick it up themselves.

  47. FLConsumer says:

    @homerjay: No, I do believe a tip is warranted in a piss-poor service situation. I usually keep 1-2 foreign coins of practically no value or a few pennies… If the service truly stinks (and it REALLY has to suck and be the fault of the waitstaff), I’ll leave a single penny or foreign coin. I want them to know I didn’t “forget” to tip — the service was that bad.

    @Ponygirl: 20% is standard? I’m curious as to where you’re located. I have a friend who waits tables at a moderately-nice restaurant in the midwest and says it’s more like 10%. Due to my frequent patronage, I’m good friends with the staff and manager at a local high-end steakhouse and they’re averaging about 16-18% for tips, and this is arguably the best steakhouse in town.

  48. suckonthat says:

    @FLConsumer: I think the 20% thing is in the Northeast. Depending on the resturant, 10% is downright insulting (as in, you think you must have done something wrong), and 15% is still seen as cheap. At a nice steakhouse in any city (I have direct or indirect experience with Philly and NYC) 20% is standard, over that for great service. Less than 20% and the servers assume you are an ameteur.

    I am all for a more European system where it is added to the bill because many outsiders, foreigners included, don’t understand.

  49. QuirkyRachel says:

    Woohoo! They’ve been doing this in Europe for years!