Vietnamese commercial banks are required to issue chip ATM cards to improve customers’ transaction security. (Photo: g-pay.vn)This is part of the country’s roadmap to replace all magnetic strip cards withchip cards by the end of this year. The chip cards are compatible with Europay,MasterCard and Visa (EMV) standards as well as those of international cardorganisations like JCB and UnionPay.
International card-issuing organisations had asked Vietnamese banks to switchto chip cards that meet EMV standards to increase safety amidst a growingnumber of information thefts. Security experts have also warned Vietnam’sdelayed transition to chip technology could put the country at risk of becominga haven for card criminals from around the world as it is among thedwindling number of countries where magnetic swipe cards are still prevalent.
According to banks, issuing a chip card can cost some 1.50-2.50 USD, meaningthey will have to spend between 105 million USD and 175 million USD for thetransition, in addition to the cost of upgrading ATMs and core banking systemsto adapt to the change.
Besides ensuring greater payment security, the replacement is also among thecentral bank’s plans to promote non-cash payment methods. Under theGovernment’s strategy, by the end of 2025, at least 80 percent of adults inVietnam are hoped to have bank accounts and the number of non-cash transactionswill expand by 20-25 percent annually.
However, banks said the switch faces significant barriers when their customersare hesitant to move to chip cards as they have to fill in a lot of documentsfrom the banks.
To deal with the issue, foreign and domestic banks in Vietnam have implementedthe e-Know-Your-Customer (eKYC) solutions to provide customers with seamlessonboard experience and reduce paper-based procedures.
According to the State Bank of Vietnam’s Payment Department, Vietnam had 94million domestic cards in circulation by the end of 2020, most of which wereATM cards./.
VNA
