It is important to educate credit card users on PIN

With the new PIN system, card-users can now enter their cards into payment terminals themselves and then verify the transaction with a PIN - the card never needs to leave their hands.

ALTHOUGH Malaysia will start implementing the use of PIN number to authorise credit card transactions in 2017, banks in Malaysia have done very little to create awareness among its customers on the importance of the PIN (personal identification number).

The migration to PIN from signature is part of a worldwide shift to protect credit card users from fraud.

About 39 million – eight million credit and 31 million co-badged debit cards in Malaysia – will be replaced with new PIN-enabled cards to meet the January 2017 deadline set by Bank Negara.

The migration to PIN number cannot be exaggerated. It is now widely practised in many European countries, Canada, Australia and New Zealand.

This means that you will not be able to use your credit card with retailers in Europe where they have card machines that read only PIN numbers. Your nightmare begins when you have to call back long distance to the issuing bank to obtain a PIN number if you don’t carry sufficient cash or are stuck in an emergency.

To call your bank from Europe cost one euro per minute. If you are using a roaming line, the charge is RM9 per minute.

The anticipation of a whopping phone bill can be stressful. The other tormenting experience is talking to not just one but several customer service officers who have only half-baked knowledge about the PIN system that will be implemented in the country. This unnecessarily prolongs the time to get a PIN, incurring even higher call charges.

My recent experience with several credit card customer service officers from a bank in Malaysia is very telling how inadequate they are in educating customers on the use of the PIN.

Although I had informed the bank which issued the credit card about my travelling plans in Europe, I was not advised to get a PIN. Nor was I cautioned against the problems that I would eventually face where only PIN are accepted.

In Barcelona, where I recently spent my vacation, about 90% of the retailers there accept only PIN for credit card authorisation.

Upon complaining to the bank which issued my credit card, the bank apologised and reimbursed the long distance call charges which I had incurred from talking unnecessarily to their customer service officers for an extended period.

It is not difficult to obtain a credit card PIN.

There are banks which allow customers to create their own PIN online, while there are others which will send the PIN to you.

The problem is that most banks in Malaysia would rather call to promote loans and balance transfer packages, instead of explaining the importance of the PIN for local and overseas use.

As a result, most of my friends who travel extensively know very little about the PIN system. Nor do they know that Malaysia will be phasing out signature-based credit cards next year. Instead, they learned about it via a third party.

A friend of mine who had just returned from Europe said he learnt about the PIN informally from a friend who works in the priority banking department, and not from the credit card customer service department.

Banks in Malaysia also need to inform customers that the PIN in Asia is six digits, while it is four digits for European countries, Australia and UK.

This means that if retailers in these countries have credit card machines that read only four-digit PIN, you will still not be able to use your six-digit credit card PIN.

Until last year at La Roca, a luxurious factory outlet in Barcelona, the retailers there had credit card machines that only read four-digit PIN, causing great inconvenience to visitors from China, whose PIN are six digits.

There were so many complaints from tourists who shopped La Roca Village that eventually the banks had to issue credit card machines that can read six-digit PIN as well.

Hopefully, with our June 13 front page story highlighting the phasing out of signature-based credit cards, by next July, banks in Malaysia will adopt measures to educate customers on the importance of credit card PIN for domestic and overseas use.

David Tan is Star Media Group news editor (business) North

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