The machines, manufactured by Racal Electronics and supplied by HSBC, one of Britain's largest banks, improperly rejected credit cards because of a failure to recognize the year 2000.
Merchants who tried to swipe MasterCard and Visa cards through some 20,000 machines beginning on Tuesday found they were improperly rejected, said HSBC spokeswoman Nicolette Dawson.
Lines grew as retailers were forced to telephone for further authorization.
The failure, characterized by Dawson as minor, comes just days before the New Year when most Y2K glitches are expected to be felt. Experts say the seriousness of disruptions will depend on the quality of Y2K remediation.
The so-called millennium bug stems from programming that expressed years in two digits. Left uncorrected, the bug causes computers and microcircuits to mistake the year 2000 for 1900. Faulty fixes can also be a problem. In both cases, systems can fail or corrupt data.
Dawson said the HSBC failure occurred because some of the bank's new swipe card terminals are programmed to look ahead four working days in processing transactions. "The problem was with the terminals not the cards," she said. "There's no way any customers would be inconvenienced."
She said the problem was expected to disappear by Jan. 1.
In the meantime, shopkeepers were advised that in lieu of telephoning for authorization they could process cards by pressing a sequence of keys into the terminals before swiping the card.
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