Australian retailers embrace PIN but need to be mindful of PIN exemptions

 

PEAK retail industry body the Australian Retailers Association (ARA) congratulates merchants and their customers on a rapid take-up of PIN as the main form of card payment authorisation in Australia.

At this point of the transition period, with well over 90 percent¹ of Australians now using PIN at the point of purchase, the changeover from signature to PIN has been deemed a success by the industry.

ARA Executive Director Russell Zimmerman said that the messages surrounding the switch to PIN have resonated with merchants.

“We have seen an impressive nationwide embracing of PIN among merchants, retailers and business owners, which will strengthen the security of Australia’s payment system. 

“That said; it’s important for merchants to remember that there are certain credit and debit card exemptions where signing is still the principal form of payment authorisation.

“There are three key exemptions to compulsory PIN authorisation, where cardholders may need to sign and are permitted to do so:
 

1. Australian credit and debit cards without an embedded chip:
   Australian issued magnetic-stripe (mag-stripe) cards without an embedded-chip will still be able to use signature for authorisation. Many of these cards will be replaced with chip-enabled cards by their issuer in the near future. This includes some American Express and Diners Club cards and certain gift cards. 

2. Cards issued outside of Australia:
   Visitors from overseas are not impacted by the changes, so they will use signature or PIN to authorise transactions as they did before. Hence signature will still be a valid form of payment authorisation for most visitors from overseas. 

3. Signature-preferred cards:
   Special limited issue signature-preferred cards are available for Australians with a genuine need to sign. Signature-preferred cards feature a special chip to identify that the card does not require a PIN to complete the transaction; automatically notifying retailers via the POS terminal screen that a signature is permitted.

“As previously advised, contactless transactions up to $100 do not need to be authorised by PIN or signature.The operation of Visa payWave, MasterCard PayPass, and contactless payments from other providers, including American Express, have not changed in light of the move to PIN.

“As the software in POS terminals is progressively upgraded across Australia, there may still be situations where customers are offered the option to sign or PIN. Merchants and customers should follow the prompts on the terminal screen to determine the appropriate authentication method.  However, where possible PIN should be promoted as the primary authorisation method, as the number of places where signature is accepted will quickly reduce over the next few weeks,” Mr Zimmerman said.
 
¹     SOURCE:  Financial institution data.  Figures are based on cardholder behaviour data provided directly from Issuers.
 
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.
 
About PINwise
 
Being “PINwise” means using a PIN to confirm your identity when you use your credit or debit card to conduct a transaction at a point of sale in Australia.  Using a PIN helps protect against fraud due to lost or stolen cards.  This is because the chances of someone correctly guessing your PIN, which can be from four to six digits long, is very small.  More information can be found at pinwise.com.au

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