An authentication channel is established between a mobile device and a transaction terminal that uses a keypad for access control. The terminal keypad is assumed to be untrusted, whereas the mobile device has a trusted interface that only the device user can access and use. The transaction terminal includes a short-range communication device, and a keypad interface application configured to communicate with an external keypad device in lieu of the transaction terminal's own keypad. The mobile device includes a mobile app. In response to detecting a user access request, a handshake protocol is performed between the keypad interface application in the transaction terminal and the keypad interface function in the mobile device. If the handshake protocol succeeds, the user is notified that the transaction terminal is trusted. The user then enters his or her password and/or PIN on the mobile device in lieu of direct entry via the terminal keypad.