State Bank of India (SBI) will soon issue EMV chip and pin-based debit cards to all its new customers.
This move with enhanced features and security will help customers from fraud such as skimming and fake card transaction.
The Reserve Bank of India has directed all banks to issue only EMV Chip and Pin based cards to all customers including account holders of Prime Minister Jan Dhan Yojana, Basic Savings Bank Deposit Account (BSBDA) and other Government schemes.
Here are 5 things to know about EMV Chip and Pin based cards
1) EMV stands for Europay, MasterCard and Visa which is a global standard for cards with chip technology to secure the chip based card transaction.
2) Using EMV based cards make the transaction secure as every time you swipe your EMV card, it generates a unique code, unlike your other debit or credit cards which can allow them to copy the code as it remains same after each swipe.
3) Once the card is swiped at the point of sale (POS), one has to authenticate the transaction by entering PIN.
4) However, even data can be breached, the process makes much harder for the fraudster to complete the transactions.
5) The card can be used at ATM and online transactions at websites that accept Visa debit cards.
The Reserve Bank of India had asked banks to issue only chip-based and PIN-enabled debit and credit cards from September, with an aim to protect customers from frauds.
As per RBI guidelines, all the issuing banks to note that the magnetic stripe cards issued would have to be replaced by December 31, 2018, irrespective of the validity period of the card and accordingly banks may have to take proactive steps to ensure that the deadlines are adhered to without fail.
An extra layer of security is always welcome, in an era where it is not too difficult for fraudsters, to break through accounts. It is believed that data breaches were more than 1500 in 2014 and the number is fast rising.
A lot of these breaches takes place in the financial services sector and also the retail sector. According to statistics, both these figures could well total more than 20 per cent of the fraud happening on credit cards.
One of the good things to note, as far as India is concerned that it has relatively lesser number of known credit card transaction frauds as compared to other parts of the world. United States has the highest. Despite this, the RBI's move to introduce EMV Chip and Pin based cards is a welcome move.