Terminals fall back on offline authorization when the issuer cannot be reached: the chip and the terminal apply stored rules, approve or refuse the payment between them, and the transaction waits to be submitted once the connection returns. No request reaches the bank at the moment of sale.
Where the yes comes from when nobody is asked
An EMV card carries risk parameters and counters of its own, and the terminal carries the acquirer's. Between them they reach one of three answers: approve locally, decline locally, or insist on going online whatever the terminal would prefer. The card has the final say — a chip can force an online authorization that the merchant's equipment was quite happy to skip.
Floor limits and the tap that suddenly wants a PIN
A floor limit is the value below which a terminal may decide for itself. Acquirers set it per merchant category, and set it low or at zero where fraud rates or average tickets are high. Card and terminal also count cumulative offline spend since the last online contact; once that counter passes its threshold the next payment goes online whatever its size. That is what a shopper is meeting when a fifth small contactless tap unexpectedly asks for a PIN.
The merchant is betting the issuer would have agreed
Offline acceptance moves risk onto the merchant. If the account is closed, frozen or empty, the transaction is refused when it is finally presented, and the goods have already left. Scheme rules limit dispute rights on payments the issuer never saw, so there is rarely a route back. The contrast is worth holding onto: during an issuer outage the network answers through stand-in processing and the issuer, not the merchant, carries the bad ones.
Two businesses, opposite settings
A duty-free shop selling watches keeps its floor limit at zero and accepts that a connectivity failure means no sale at all, because one bad approval costs more than a day of missed ones. A metro operator does the reverse, approving taps in milliseconds and treating a small share of unrecoverable fares as the price of moving people through the gates. Both are right, and the only difference is average ticket against fraud exposure.
Getting stored transactions off the terminal
Held payments do nothing until they are uploaded, and only then do they enter batch processing and reach settlement. Sites that rely on offline acceptance need a forced upload schedule rather than best-effort syncing. Every day a file sits on a terminal is revenue that is neither declined nor paid, and it surfaces in reconciliation as a gap nobody can explain.