Banks to scrap signatures

visa,online shopping, credit card,eftposFrom next week Australia’s banks will decline Visa and Mastercard transactions with signatures, enforcing the PIN only option.

The move from signature to PIN commenced on August 1, phasing out the acceptance of signature as a valid form of authorisation on most Australian issued credit and debit cards, however, retailers could still override that and accept signatures.

From next Monday, that option will be taken away from retailers with Australia’s banks enforcing the PIN only option, and declining signature transactions.

The development comes as new research by independent payments provider, Tyro Payments, shows consumers embracing PIN over signature transactions.

Findings from 11,000 small to medium sized businesses, including restaurants, cafes, and pubs, show that when given the choice between PIN and sign, consumers are now opting to use PINs 99.6 per cent of the time, compared to only 59 per cent late last year (Nov 2013). PIN usage has been widely accepted.

Australians have more than 50 million credit and debt cards, with use increasing by more than six per cent a year, as we move towards a ‘cashless’ society.

“Tyro is no longer concerned about customers having to search for cash in a panic, because they don’t have a PIN number attached to their credit or debit card,” Tyro Payments co-founder, Andrew Rothwell, said today.

“That’s because customers have taken on this more secure form of payment with gusto.”

The only exceptions for signature sales will be for:

  1. Contactless transactions under $100 (Visa payWave, MasterCard® PayPass™ or American Express Contactless)
  2. Magnetic stripe (mag-stripe) cards issued in Australia that have not yet been replaced with chip cards
  3. Cards issued outside of Australia
  4. Signature-preferred cards issued to Australians with a genuine need to sign.

Rothwell said Tyro finished upgrading all its 20,000 terminals last month, in antipation of next Monday’s changes.

“However, we continue to be concerned with disruptions for Australia’s 37,700 restaurants, cafes and pubs, because the mandatory PIN entry forces patrons to pay either at the table or at the cashier,” he said.

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