Banks line up smart cards as incidence of fraud rises
At least two banks - Hang Seng Bank and DBS Bank (HK) - plan to launch more secure chip-embedded credit cards this year.
DBS (HK) is expected to make its EMV (Europay, MasterCard, Visa) cards available to customers as early as the second quarter while Hang Seng plans to issue the smart card in the third or fourth quarter.
Market watchers believe the increased incidence of credit-card data leakage in the mainland and the US last year is prompting banks to speed up the process of replacing their magnetic strip cards.
Hong Kong Monetary Authority chief executive Joseph Yam Chi-kwong has constantly called for improved authentication arrangements and tighter data security to make credit-card business safer. 'The inconvenience caused to the card holders and the effect of these events on the integrity of the credit system undermines user confidence,' he said in his website column last week.
A veteran of the card industry said many businesses were gearing up to issue chip cards because it was the card issuers who had to bear the losses from fraudulent transactions made with the stolen data, not the card holders.
'Taiwan and Malaysia have already issued chip credit cards and have recorded an improvement in fraud prevention,' he added.
Sunny Cheung Yiu-tong, a director and head of consumer banking at DBS (HK), said: 'The chip card has a greater memory and processing capability which enhances security and allows banks to offer more business functions.'
Sources said HSBC also planned to launch a chip card this year.