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Pin or pen?

Date Published : Friday, June 06, 2008

New personal identification number (Pin) verification is being rolled out across Australia this week.

The financial services industry scheme is intended to speed up payment for goods and services and simplify transactions.

Featuring on most credit and debit cards, the new system allows cardholders to select a 'credit' or 'Cr' button at the point of sale and either input their Pin number of sign for goods.

Simon Greig, Pen or Pin project manager, declared: "From today there is a convenient alternative to signing to authorise those transactions, by entering a Pin at the point of sale after they have pressed the 'credit' button."

Consumers with Pin-enabled cards can start to make purchases this week, though the new system is not mandatory and those with a Pin can still choose to use their signature to authorise transactions.

A combination of concerns about forged signatures and a desire to make card purchases faster and simpler has driven the decision to adopt the system, which is already in place in a number of other countries including the UK.

Merchants do not always check the authenticity of signatures with card purchases and the new Pin system should reduce the number of investigations into false-positive transactions carried out by banks and card issuers each year when consumers challenge whether they were present or not when a purchase was made.

The scheme has been supported by all Australian financial institutions and card schemes, though some experts have questioned whether it will actually help to reduce fraud and improve security.

Australia has an estimated 44 million debit and credit cards, with more than 118 transactions made per month on cards totaling around $17.5 billion.

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