KUALA LUMPUR (Nov 9): Bank Negara Malaysia has said it will reserve the right to take action if individual banks are unable to validate the pin-and-pay mechanism for payment cards by the end of 2016.

"To the extent that the bank has not made sufficient effort, we will review each bank on an individual basis," said Tan Nyat Chuan, director of the payment systems policy department in the central bank.

Bank Negara revealed it targeted for all credit and debit cards to be pin-enabled by Dec 31, 2016 at a media briefing today.

Meanwhile, RM455 million has been allocated via the Market Development Fund for the expansion of point-of-sale (POS) terminals. The fund is an initiative of MasterCard and Visa via merchant banks.

Currently, some 38% of terminals have been replaced, with a 100% replacement rate targeted for end of the year.

Members of the public are urged to replace their signature based debit, credit, prepaid and charge cards, with pin-based payment cards by Jan 1, 2017.

By July next year, signature based cards will be phased out.