Credit, debit cards get a makeover: What it means for your
The Reserve Bank of India has asked all banks to replace magnetic-stripe-only cards with EMV-chip based cards by 31 December
Mumbai: The plastic cards sitting in your wallet got some limelight this year. As on September 30, 2018, there are 990 million debit cards and 42 million credit cards in the country compared with 847 million debit cards and 36 million credit cards in the beginning of the year, according to the Reserve Bank of India (RBI). With increasing number of transactions, the regulator and bankers are looking to provide security and convenience for your wallet.
Here is a look at what changed for your credit card and debit cards:
EMV-chip mandatory for cards
If your credit card and debit card is still without EMV-chip, it will have to be upgraded by the end of this year.
The RBI has asked all banks to replace magnetic-stripe-only cards with EMV-chip based cards by 31 December 2018. For instance, State Bank of India (SBI) is currently replacing old cards with EMV-chip based cards for its debit and credit card customers. EMV-chip based cards have embedded microprocessor chip that store and protect cardholder data and is a much secure technology as compared with magnetic stripe card, according to the bank website. Banks will provide it free of cost.
Multi-purpose and virtual cards
Some banks have started providing one card through which you can do both credit card and debit card transactions. For instance, Indusind Bank Ltd and Union Bank of India have launched debit cum credit card in one card. The card will have two EMV chips—one for debit and another for credit option. To swipe based on your need choose the debit or the credit option. The joining fee is in the range of ₹200-250. Indusind Bank also provides Nexxt credit card which had push buttons on the physical card and allow you to convert your transactions to EMI and also redeem points. Some banks also offer virtual cards, which you can load in your mobile phone and use it from the device.
Local branded, e-commerce tie-up
In order to increase volumes in credit card and debit card transactions, banks have included e-commerce and local tie-up. “Normally cards have pan-India alliance. This year we have started doing local alliances. For instance, in Chandigarh there are local restaurants with which we have tie-up. We can generate footfalls for the partners. The marketing spends have moved to banks as they are also searching for customers,” said Anup Bagchi, executive director, ICICI Bank Ltd.
Banks are making it easier for you to transact. However, don’t go overboard with your spends as it will impact your credit score.
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