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If telephones/smartphones/tablets are not allowed on planes, how comes when you buy duty free items from the cabin crew and pay by cc they will use the card reader?

I suppose that in order to remove credit there must be some sort of connection to the various credit cards circuits in real time in order to achieve this?

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Presumably, they use an off-line transaction. The reason your credit card has raised numbers is that, in the old days, before ubiquitous data connections, a card transactions used a machine like this

enter image description here

to transfer an imprint of your card details onto a form, using carbon paper. You would then sign the form and the merchant would send it off to the bank to get paid. It wasn't possible to verify in advance that you had enough money in your account but the deal was that the bank would honour the transaction and then come after you with a big stick. The point of my mentioning this is that, although we're now very used to the idea that the merchant talks to your bank while you make a card transaction, this wasn't the case even 20 years ago.

Today, it's still possible to make a card transaction without verifying in advance that the card has sufficient funds, so that you can still buy stuff on your card even if the merchant's phone line or internet is broken. In fact, the last-case fall-back is to go back to the swipe machines and carbon paper.

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    $\begingroup$ Additionally, if you look at the bottom of almost any receipt you sign, you're actually signing a statement saying that you agree to pay that amount as per your cardholder agreement. So even if the amount would take you over your credit limit, the card company can still hold you responsible for the amount. And possibly charge you fees (I'm not sure about that one, but it wouldn't surprise me). $\endgroup$
    – Bobson
    Aug 26, 2014 at 12:14
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It will either go through the airline's existing air-to-ground system (like the seat-back phones you pay $5/min for) or they've got a store-and-process-later arrangement with the card companies.

(Just because you can't use a phone doesn't mean the airline can't, they just follow certain conditions better)

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  • $\begingroup$ There are some questions on this site that explain that mobiles are banned more because they would not actually work anyway than because they would interfere with anything. They do interfere with earphones (induce noise), but only if closer than about a metre and the passengers are further from the pilots than that. $\endgroup$
    – Jan Hudec
    Aug 25, 2014 at 14:14
  • $\begingroup$ Mobiles are banned mainly because they have not been approved. FAA/EASA etc. take the opinion that anything attached to or actively working in an aircraft must be conclusively proven to be safe. That's why your airplane, it's parts, maintenance and accessories cost so much. $\endgroup$
    – paul
    Aug 26, 2014 at 0:28
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    $\begingroup$ Negative. This question (that helpfully came up in related) says "… which is why the Federal Communications Commission (FCC) — not the Federal Aviation Administration (FAA) — banned cell use on planes.". FAA and EASA don't have problem with mobile phones anymore. See also wired.com/2013/10/faa-ban-lifted. $\endgroup$
    – Jan Hudec
    Aug 26, 2014 at 5:01
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    $\begingroup$ Cell phones don't work properly because tower antennas are directional (any energy sent upwards would be wasted normally) and the handover process between cells is fairly slow (it needs to appear seamless, even in crowded networks). The network they use for in-flight service is most likely a satellite link. $\endgroup$
    – Simon Richter
    Aug 26, 2014 at 10:51
  • $\begingroup$ This answer is wrong. One of the other answers should be marked as the accepted answer. $\endgroup$
    – Philippe Leybaert
    Aug 26, 2014 at 20:27
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What is it called?

Buying stuff on an airplane during flight is know is in-flight commerce (IFC).

How it works?

Credit cards are swiped via wireless handhelds on aircraft but the transactions are processed when the aircraft gets on the ground.

Limitations

Because of this billing mechanism – which sometimes results in fraudulent transactions – there is a ceiling of the value of items that can be comfortably sold today.

Read more here and here.

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  • $\begingroup$ So what prevents a bad actor from using a seemingly valid, but bogus credit card to buy drinks? Do the offline systems correlate seat position to card use to follow up on fraud later? $\endgroup$
    – Freiheit
    Aug 25, 2014 at 17:30
  • $\begingroup$ HI @Farhan -- I'm surprised: don't SOME transactions go via whatever system the aircraft uses, for, air-to-ground telephoney? Visa and MC ar both incredibly down on offline transactions these days; I'm surprised it's possible. $\endgroup$
    – Fatster
    Aug 25, 2014 at 18:24
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    $\begingroup$ Freiheit - with genuine offline credit card transactions (I"m astounded to hear these are still possible today, in any context) - quite simply nothing, zero, prevents fraud. For example, a very very rare example is that on the freeway system in Spain, when you pay a few bucks toll using a card (unless the technology has changed just lately), it's an offline transaction. "everyone" knew this and you could scam it with, basically, anything that "looked like a credit card" heh. There is no, zero, protection against fraud w/ offline card transactions. $\endgroup$
    – Fatster
    Aug 25, 2014 at 18:26
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    $\begingroup$ @Fatster, I assume that it depends on the company running the concession (although it makes sense they are offline transactions, as tolls are usually in the middle of nowhere). However, it would be really simple for them to attach the plate number (or just a photo) to the transaction id (clear them nightly, after transactions have been processed). As the fine if being caught will be much more expensive than what they are ripping off, it's surprising they are so mean to do that. OTOH, if the company doesn't bother to prosecute them is a sign that it is uncommon enough not to be worth. $\endgroup$
    – Ángel
    Aug 25, 2014 at 21:21
  • $\begingroup$ @Faster How is that supposed to work? I have heard about credit card fraud on tolls (mainly with stolen credit cards) but how does that work with something that merely “looks” like a credit card? $\endgroup$
    – Relaxed
    Aug 26, 2014 at 7:33
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I worked with the credit card processing at one of the bigger airlines a few years ago. We used handhelds that stored the info from the magnetic strip of the card. The transactions were uploaded to our back office system and then to the payment service provider after the flight landed.

The only "hard" protection is the modulo 10 checksum of the credit card number (http://en.wikipedia.org/wiki/Luhn_algorithm). The fact that the airline knows exactly who is on a flight also makes it much harder to get away with this type of fraud.

During my time at the company I don't think I heard of a single case of attempted credit card fraud (that doesn't mean there weren't any). I think theft is a much larger problem in on-board retail.

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Transactions are offline. The data is sent to the payment gateway on connection between the POS and wifi/GSM network on the ground. Fraud happens, a lot. Airlines have dedicated departments to chase these failed payments with varied success. One Dutch airline, once the card ceiling was crossed (e.g. upgrades for a family might cost over €1000 which might be the ceiling limit set) would have the captain make a call to have the card payment cleared. You're welcome, Mr J.

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    $\begingroup$ [citation needed] $\endgroup$
    – Federico
    Nov 15, 2016 at 14:17
  • $\begingroup$ ? What do you mean? $\endgroup$
    – Mr Johnson
    Nov 15, 2016 at 14:18
  • $\begingroup$ that you do not provide any source for the claims you make. for example, who says that "fraud happens, a lot"? $\endgroup$
    – Federico
    Nov 15, 2016 at 14:21
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    $\begingroup$ I am the source. It is the world I work in. $\endgroup$
    – Mr Johnson
    Nov 15, 2016 at 14:25

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