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Banks want more time to apply 6-digit credit card PINs
The Indonesian Credit Card Association (AKKI) has called on Bank Indonesia (BI) to extend the deadline for the application of a six-digit personal identification number (PIN) on credit card transactions, saying many credit card holders are not yet ready to use their PINs
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T
he Indonesian Credit Card Association (AKKI) has called on Bank Indonesia (BI) to extend the deadline for the application of a six-digit personal identification number (PIN) on credit card transactions, saying many credit card holders are not yet ready to use their PINs.
AKKI general manager Steve Marta said that the banking industry had requested an extension of the deadline as most credit card holders had not activated their PINs.
According to Steve, technologically speaking, banks are ready to realize the PIN requirement.
'However, only some existing credit card holders have activated their PINs and that has raised concerns about their preparedness [for PIN implementation] on the whole,' he said on Wednesday.
The PIN requirement for credit card transactions is stipulated by a 2012 BI regulation, which the central bank claims will increase transaction security.
According to the regulation, all transactions must already be validated by a six-digit PIN on Jan. 1, 2015.
However, despite the two-year 'original' transition period, data from AKKI shows around 70 percent of credit card holders still have not activated their PINs.
There were 8 to 9 million credit card holders and 15.8 million credit cards by the end of September, as shown by data from AKKI. The number of card issuers stands at 23, consisting of 22 banks and one non-banking firm.
According to the organization's latest data, the number of the credit cards had increased to 15.90 million at the end of October, rising from 15.09 million in 2013 and 14.81 million in 2012. Meanwhile, the value of the transactions reached a total of Rp 204.40 trillion (US$16.52 billion) at the end of October 2014, as compared to Rp 219.02 trillion in 2013 and Rp 197.55 trillion in 2012.
- All credit card transactions must be validated by a 6-digit PIN by Jan. 1, 2015
- Banks technically ready for PIN requirement
- 70% of credit card holders have not activated their PINs: AKKI
That data reflects a strong demand for credit cards as a payment tool in the country, as steady economic growth in recent years has boosted citizens' purchasing power.
BI Governor Agus Martowardojo acknowledged the planned transition period, saying the central bank would discuss in more detail the length of the additional time extension.
'We will still allow the transactions to be validated by signature use next year,' he said.
Meanwhile, Bank Central Asia (BCA) senior credit card general manager Santoso said the private lender had also seen 30 percent of its total card holders activate the PINs.
'There is an indication that some customers tend to procrastinate when it comes to activating the PIN,' he said. BCA has so far issued 2.55 million cards and has 1.15 million card holders.
Santoso, who only goes by one name, said an additional six months would be sufficient to fuel customers' awareness of the PIN requirement.
BCA would continue issuing notifications about the requirement in card billing statements and deploy more electronic data capture (EDC) units to carry out the PIN activation, he said.
Bank Mandiri consumer cards group head Boyke Yurista said three months would be enough to encourage the remaining 70 percent of card holders nationwide to activate the PINs.
According to statistics from the bank, it has already issued 2 million cards and has around 1.6 million credit card customers as of now.
Boyke said that, besides deploying EDC to assist with the PIN activations, it would also use SMS.
