The Industry Security Initiative, a collective of Australia’s major financial institutions and card schemes, has announced that PIN will become the main form of card payment authorisation in Australia from 1st August 2014. They plan to expand PIN at the point of sale (POS) and phase-out the signature as a form of verification on Australian credit and debit cards. The initiative, which is supported by the PINwise communications campaign, is a national bid to make Australia’s payment system even safer.
So why is using a PIN for your purchases safer than signing?
If you’ve ever worked in a job that involves transactions, you’ve probably had to get someone to sign their signature on a receipt. But did you scrutinise that signature, or merely assume that the person holding the card was also the person who owned it? Judging by how often I successfully forged my parents’ signatures on P.E absence slips, even scrutiny may not fox a master fraudster. By having a number that only you know, it makes card fraud that bit more difficult for those pesky criminals trying to steal your money.
The move will see all of Australia’s 800,000 merchant payment terminals undergo a software update to no longer accept signature as the main form of card authorisation for Australian cardholders. There will be no change to contactless or online transactions and only in some circumstances such as when using a card issued from a bank overseas, will signature still be a valid form of verification. At First Choice Credit Union we have a PIN change terminal where our members can come into our main office and change their PIN to something that is easy for them to remember. It’s that simple! When choosing your 4 or 6 digit number, try and pick something you’ll be able to remember but also something that’s not easy to guess, for example, birthdays.
When is a PIN required?
* Australian chip cards (debit, credit and some pre-paid cards) will require a PIN instead of a signature to transact at point of sale.
* Not all terminals can be upgraded immediately on 1 August 2014, so there will be a short transition period.
When is a PIN not required?
* Contactless transactions under $100 and transactions that do not require a PIN or signature.
* Transactions made over the internet and telephone
* Australian issued cards without a chip (ie: only magnetic stripe)
Who is exempt?
* There will be no change for cardholders from overseas, who can continue to PIN or sign as they do today.
* A small number of Australian cardholders will be issued with cards that will allow them to continue to sign due to their individual circumstances.