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PIN Only Credit Cards

Greg Medcraft

17th July, 2014

From 1 August 2014, PINs will become the main form of card payment authorisation in Australia. From this date you will not be allowed to sign for credit and debit card purchases when you are buying a product at a point of sale.

This change will only affect transactions where you’re physically present at the point of sale and if the card you’re using has an embedded smart chip. You’ll continue to sign when using chip-less cards with a magnetic strip at the back.

In other limited circumstances, such as when using a card issued from a bank overseas, a signature will still be a valid form of verification.

When a PIN is not needed

The change won’t impact online shopping, telephone purchases or contactless card transactions (such as Visa’s payWave and MasterCard’s PayPass) where you wave your card or ‘tap and go’ to authorise purchases under $100.

Why a PIN is safer than signing

Your PIN transaction is encrypted and sent in real-time to your card issuer to be authorised. Using a PIN can help protect against fraud if your card is lost or stolen because the fraudster would need to have both your card and your PIN.

What you need to do

Different card issuers have different processes for organising a PIN, so if you don’t have a PIN or have forgotten it, contact your card issuer to organise one before 1 August.

You will still need to sign the back of your card as the signature will continue to be used for verification in certain situations, such as travelling overseas or where a merchant has not upgraded to a PIN enabled terminal.

If you have problems remembering a PIN or have a disability that makes using a PIN difficult, contact your card issuer to discuss your options.

Choosing a PIN

Choose a PIN that is easy for you to remember but hard for anyone else to guess. Don’t use numbers associated with any publicly searchable information such as your birthday, driver’s licence or address. PINs can usually be from four to six digits long.

Most card issuers will let you use the same PIN for cash withdrawals at ATMs as well as point of sale purchases, if your card can be used for both kinds of transactions.

If you suspect someone other than you knows your PIN, you should immediately contact your card issuer to change your PIN.

Overseas use of your card

Be aware that your PIN might not work when you use your card overseas. Depending on the overseas merchant, you may still need to use a signature to authorise purchases.

If you are travelling overseas, you should always contact your card issuer before you travel so they know to expect transactions processed from overseas.

If you have any questions about PIN only cards, speak to your card issuer.

Visit ASIC’s MoneySmart website at moneysmart.gov.au for more information about choosing and using credit and debit cards.

Greg Medcraft
Chairman
Australian Securities and Investments Commission

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