The initial push by payments firm Square into Australia hit a rough patch after the security of its mPOS reader was scrutinized, as noted by The Australian.
Though the device, designed for use in the United States, accepts chip cards, it was not set up with a PIN pad. Commonwealth Bank, the biggest bank in the country, blocked payments being made through the reader as part of a pilot program earlier this month, the paper reported on Thursday (March 17). The block was removed only in the wake of a push by two other payments giants, MasterCard and Visa, the latter of which has a 1 percent stake in Square. That block could indeed be reinstated, said The Australian, in the event that the two card companies do not prove to allay the bank’s security concerns.
Square, for its part, told the paper through a spokeswoman that security remains at the top of key priorities within the FinTech firm. “We would only deploy a solution that is secure for cardholders, their issuing banks and our sellers,” the spokeswoman told the paper. “We have extensively tested our solution with the world’s leading, independent security companies and received written approval from the three participating international payment schemes.”
The security concerns are tied to the use of PIN codes across consumer devices versus the security offered up via hardware by banks and other financial players.
According to the Australian Payments Clearing Association, the Square Reader is not on the list of approved devices under industry standards currently in place.