SIGNATURES are to be officially abolished on credit and debit card purchases of more than $100 from 1 August 2014, and replaced with pin codes.
The move is expected to see a significant reduction in payment fraud in Australia as consumers will be better protected by needing to enter their PIN for credit and debit card transactions to be approved.
Australians made around five billion card payments during the financial year 2012/2013, with a total value of $434 billion, according to the Reserve Bank’s Payment Systems Board data.
The use of debit cards continues to grow strongly in Australia with 14.4 per cent year over year. Using chip card technology and PIN entry is an effective method to stamp out card theft and skimming in face-to-face transactions.
Australia’s leading independent EFTPOS provider, Tyro Payments, welcomed the move to mandatory PIN transactions.
“With Australians spending more than $400 billion a year on credit and debit card transactions, it’s vital that fraud and criminal activity is minimised as much as possible to protect customers, retailers and banks alike,” Tyro CEO Jost Stollmann said today.
“Australia is moving closer and closer to a cashless society and PIN codes will protect against fraud in a way that signatures cannot.
“We knew that customers would be impacted by this change and have worked tirelessly on a solution that would ensure that they wouldn’t be unnecessarily inconvenienced. With our Australian first mobile integrated EFTPOS solution we have long been ready for the move to abolish signatures,” said Mr Stollmann.
The announcement is expected to impact Australia’s 14,000 cafes and restaurants, their staff and customers the most, with customers having to leave their seats to pay for bills at the cashier using their four digit PIN code.
“While mobile terminals are nothing new, their adoption in restaurants was lacklustre to say the least. Australians spend a huge $10 billion annually dining out at cafes and restaurants1 and struggling retailers can’t afford to alienate their customers.
“Tyro’s solution is supported by diners, restaurant staff and restaurant managers – who no longer have to spend lonely nights, after staff have gone home, punching numbers into terminals to process tips.”
In 2012 Tyro worked closely with key software providers to develop Australia’s first and only, all IP based, integrated “pay at table” solution. The solution establishes a conversation between the restaurant management software and the payment terminal and allows the consumers to use the device at their table at their own pace to split the bill, pay and tip using their four digit PIN.
“VISA and MasterCard have spent a lot of money to educate the public about the importance of being ‘PIN-Wise’, but are ultimately not addressing the real issue of putting the customer first and ensuring they are not more inconvenienced by the payment process,” Mr Stollmann said.
“The PIN requirement puts the customer back in control. It’s virtually impossible for a fraudster to ascertain a PIN, while forging a signature is easy. Our wireless integrated pay at table EFTPOS system is a perfect complement to eliminating credit card signatures.
“Tyro’s mobile terminals revolutionise the customer paying experience and makes restaurant staff and owners lives much easier.”
Last year the ACCC granted ‘authorisation2 to Visa and MasterCard to allow them, together with American Express and Participating Financial Institutions, to coordinate in relation to the removal of signatures as a method of authentication for most credit card transactions that are completed in person.’
BENEFITS OF USING TYRO’S INTERGRATED EFTPOS TERMINALS
Current users of the terminals have reported positive outcomes such as halving the number of trips a waiter makes to the table to close it off.
The end-of-day reconciliation and tip completion becomes a simple mouse click affair.
Customers never lost sight of their credit cards as they did in the past, which means they have total security over them.
Diners have a broader choice of cards. They will no longer be limited to today’s signature based credit cards, but will be able to use Australia’s popular EFTPOS debit card at the table.
Restaurateurs support using mobile terminals because they save on merchant service fees.
The Connolly Partnership
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About Tyro Payments Limited
Tyro is Australia’s EFTPOS innovation institution and is the first new entrant into the EFTPOS business in over 15 years. Tyro holds an authority under the Banking Act to carry on a banking business as a Specialist Credit Card Institution (SCCI) and operates under the supervision of the Australian Prudential Regulation Authority (APRA). Under this authority Tyro provides credit, debit, EFTPOS, gift and loyalty card acquiring and Medicare claiming and rebating services, but may not take money on deposit.
Deloitte. Technology Fast 50 Australia 2012, 2013 winner, 2010 BRW 4th Fastest Growing Business in Australia, four times in a row, 2010, 2011, 2012 and 2013 BRW Fast 100 award