Dankort

The Dankort logo

The Dankort is a Danish debit card and is the national credit card of Denmark. Today it is usually combined with a VISA card so it can be used abroad.

History

The first Dankort was issued by Pengeinstitutternes Købe- og Kreditkort in September 1983. In 2001 Dankort A/S was founded, and it took over the rights to the Dankort in January 2001. In 2004 the Dankort technology was upgraded from being simply a magnetic strip card, to a hybrid card with both the magnetic strip and an embedded chip. This was to improve security by reducing the possibility of card fraud, but was ill received as the card holders picture was removed from the card, making it possible, in theory, for anyone to use the card. Also, the new chip system was faulty and slow, and by 2006 it remained sparsely used. In the beginning of 2005 the Danish banks introduced a fee for using the Dankort of 50 øre ($0.07) per transaction, prompting massive protests from Danish politicians (right in the middle of a general election campaign), store owners and card holders. The law was subsequently changed converting the transaction fee to a fixed annual payment to be paid by the store, the amount depending on the number of transactions ( 4,999 or less; 5,000–19,999 or 20,000+). Further thresholds were later introduced into the system, allowing greater differentiation between stores.[1]

The Dankort system has recently become more controversial due to its success and subsequent incompatibility with foreign bankcards bearing the VISA (or Mastercard) logo. Danish law was changed effective July 2005, converting the payment per transaction paid by stores, to a fixed annual amount depending on the number of transactions. Stores are not allowed to pass this fee on to the consumer wishing to pay with a dankort.

Danish law distinguishes between varying types of debit and credit cards. The maximum rates charged are as follows:^[1]

Type of card	Fee paid by the store	Max. fee a consumer may be charged by a physical store
Dankort or VISA/Dankort[2]	Annual fee	No fee
Danish brand debit cards without security chip (e.g. Acceptcard or Forbrugsforeningen)	No fee	No fee
Danish brand credit cards with security chip (not yet introduced)	Annual fee	No fee
Danish issued international debit cards (e.g. Maestro or VISA Electron)	0.3% (max. 4 DKK)	No fee
Danish issued international credit cards (e.g. Eurocard or MasterCard)	0.75%	No fee
Foreign issued international debit/credit cards	3.75%	No more than the amount charged to the store

Due to the higher fees charged by banks for the use of non-Danish issued cards, many Danish shops only accept Dankort but not other cards, while others only accept Danish-issued credit cards. Co-branded VISA/Dankort are very common in Denmark and do not carry the bigger fee, as Danish banks treat them as Dankort within Denmark. In contrast to the Danish situation, Danish holders of VISA/Dankort are normally able to use these cards globally, wherever VISA/MasterCard is accepted.

The Dankort card is not compatible with American Express or Discover Network cards.

References

1. ^ Konkurrencestyrelsen (Danish)
2. ^ All VISA/dankort use a security chip. The now-abolished original version without the chip carried no fees for stores and consumers.

External links

• Dankort (Danish)