Retailers welcome PIN as the primary method of card verification in Australia from August 1, 2014

PEAK retail industry body the Australian Retailers Association today welcomed the Industry Security Initiative’s announcement that PIN will become the main form of card payment authorisation in Australia from August 1, 2014.

 

ARA Executive Director Russell Zimmerman said the industry-wide move to expand PIN at point-of-sale (POS) and phase-out signature as a form of verification on Australian credit and debit cards will take place over a short transition period from 1 August, as POS terminals migrate to new software.

“The phasing out of signature verification will help protect consumers and retailers alike from fraudsters. The move to PIN is about strengthening payment security across Australia and it takes advantage of the ‘chip’ technology on Australian payment cards.

“The real change for expanding PIN usage will be a behavioural one. Habits at point of sale will require some adjustment and consideration; however, it is a move that will help safeguard against fraud, making cards even safer to use and is a welcome move by Australian retailers.

“While the financial institutions will be communicating the change to their customers, those businesses who may require new technology should proactively speak to their terminal provider about upgrading their equipment to ensure that they’re ready for increased PIN use by August.

“It is also important to note there will be no change to contactless or online transactions and for visitors from overseas, signature will still be a valid form of verification.

“Using a PIN helps protect against fraud due to lost or stolen cards, and we know that around 68 percent of Australian consumers prefer PIN payments when purchasing high-cost items*. The chance of someone correctly guessing your PIN, which is usually between four and six digits long, is very small.

“$81 million in fraud is perpetrated every year on Australian cards. A small part of this figure, $18 million, is accountable by eftpos cards (where PIN is mandatory), whereas scheme credit, debit cards, charge cards and card present transactions account for a much higher figure of $63 million per annum.**

“The ARA encourages the retail industry to embrace this change as reducing fraud saves both time and money, allowing retailers to get on with the job of doing business,” Mr Zimmerman said.

Since 1903, the Australian Retailers Association (ARA) has been the peak industry body representing Australia’s $265 billion retail sector, which employs over 1.2 million people. The ARA ensures retail success by informing, protecting, advocating, educating and saving money for its 5,000 independent and national retail members throughout Australia.

Visit www.retail.org.au or call 1300 368 041

 

* Australian Consumer Payment Snapshot Report 2013 conducted by Pureprofile,
November 2013. Data captured 1,253.
 
The Card Industry Security Initiative (ISI) comprises representatives of ten Australian financial institutions including all of the major card issuers plus Visa, MasterCard™, American Express, and Diners Club International. The initiative members represent the payments card industry and their role is to ensure that there is a consistent experience for consumers when using their credit or debit card to pay for purchases in Australia, regardless of the financial institution that issues the card.
 
 
**Australian Payments Clearing Association
 
Fraud Perpetrated on Australian Cards
1 July 2012 – 30 June 2013

 

 

Australian card fraud	$ (millions)
Proprietary debit cards (eftpos – where PIN is mandatory)	$18,213,277 (majority of skimming occurs through ATM’s)
Scheme credit, debit and charge cards, card present transactions	$63,384,703
Australian-issued cards (total)	$81,597,980

 
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