Preparing for 8-digit BINs: A checklist for credit unions

Bank Identification Numbers (BINs) are the first six digits on any credit, debit or prepaid card. Whenever a cardholder transacts, the BIN helps the merchant processor identify both the type of card (Visa, MasterCard, etc.) and the institution that issued it, in order to approve or decline the transaction within a matter of seconds. BINs also enable merchants to accept multiple forms of payment including digital and mobile.

But the industry is facing a BIN shortage, thanks to the rapid growth of both the number of cards being issued and new forms of digital payment. In response, the two largest card networks, Visa and MasterCard, announced plans to expand the length of BINs from six to eight digits by April of 2022.

After the new 8-digit expansion is implemented, anytime a transaction occurs, the merchant’s card processing system will now read eight numbers instead of the first six. Every 6-digit BIN will automatically add two numbers at the end of the string (00, 01, 02, etc.) all that way up to 99. So essentially one 6-digit BIN will generate 100 different 8-digit BINs. 

Three Major Ways the 8-Digit Expansion Will Impact Payment Card Issuers

  1. Licensing & Underutilization Costs – Currently, issuers pay licensing fees for every new BIN created. Which means that come April of 2022, the cost of one 6-digit BIN will increase with the new 8-Digit BINs that are automatically generated. At the same time, issuers are often penalized for underutilized BINs, which means those 99 extra 8-Digit BINs that aren’t actually in use will cost them extra. According to an analysis of VisaNet transactions, less than 9 percent of future 8-digit BINs are currently active.

 

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