Mumbai: The Reserve Bank on India on Thursday asked banks to issue only chip-based and PIN enabled debit and credit cards from September, a move aimed at protecting customers from frauds.
Some banks have moved to EMV chip and pin cards issuance, but a large number of banks continue to issue magnetic stripe cards.
As part of its security and risk mitigation measures for Card Present and Electronic Payment Transactions, the RBI said the acceptance infrastructure is getting geared to accept EMV chip and pin cards.
“Accordingly, banks are advised that with effect from 1 September 2015 all new cards issued — debit and credit, domestic and international — by banks shall be EMV chip and pin based cards," RBI said in a notification.
It further said that the migration plan for existing magnetic stripe only cards will be framed in consultation with stakeholders and time-line for the same will be advised in due course.
The RBI has adopted a phased manner of implementation of security and risk mitigation measures in card transactions.
Further, it said the time is appropriate to migrate away from magnetic stripe only cards to chip and pin cards on the level of readiness of the card acceptance infrastructure at point of sale and also implementation of PIN insertion system for debit card transaction by customers at the point of sale.
EMV chip card protects against counterfeit (skimming) card fraud. EMV Chip Card and PIN protects against both counterfeit (skimming) and lost and stolen card fraud. EMV stands for ‘Euro pay MasterCard Visa’ while PIN is acronym for ‘Personal Identification Number’ As of now, PIN is mainly required for ATM transactions.
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