Australia's AU$90 million per annum credit card fraud bill is too small to force the rollout of chip and PIN card reading technology, says the chief executive of the Australian Payments Clearing Association (APCA).
"Unlike overseas, Australia doesn't have the same extent of fraud to require a rush to chip. Compared with the UK, we're running at a small fraction of their fraudulent transactions," Australian Payment Clearing Association's chief executive, Chris Hamilton, told ZDNet.com.au.
While nine in every 100,000 transactions in Australia are fraudulent, the incidence in the UK stands at 141, according to the APCA's statistics.
Although some banks have issued customers with chip and PIN enabled credit cards, progress on deploying machines capable of reading chipped cards in Australia has been slow -- but this is intentional, says Hamilton.
"That's a practical and measured approach and we don't want to rush and inconvenience cardholders," he said.
"Many larger issuers and acquirers have done work on chips ... Some smaller organisations, which haven't put in as much time, are now starting to come to grips with the issues, but these will go on for several years," he said.
Without a mandated deadline to change to chip and PIN, businesses such as retailers, banks and card issuers can roll out the technology "when the business case makes sense for them".
It also means that banks can avoid the challenge of a mass reissuing of credit cards outside their normal expiry cycle.
"A forced reissue of all cards to chip would place a massive burden [on banks and customers], so it's much better to schedule it to fit in within the expiry cycle," he said.
But the reason there is no pressure to roll out new technology is that the card fraud is not borne by the customer, according to Hamilton.
"In most cases of fraud the cardholder doesn't wear the loss but will suffer an inconvenience in that they need to replace the cards," he said.
Despite this apparent lack of pressure, Australia Integrated Technology Services -- a division of Linfox subsidiary, Armorguard -- last week won a AU$250 million contract to overhaul 6,000 Cashcard EFTPOS machines across Australia to make them ready to read chip and PIN cards.
NAB has also made some progress on this front, said Hamilton.
"Last year NAB announced they had completed upgrading their EFTPOS terminal network to make it chip capable," he said.