Payment without cash: It is difficult for banks to transfer magnetic cards to chip cards

Chip cards enable local card issuers to expand their payment ecosystem into industries such as transport health and insurance. But banks say that converting magnetic cards to chip cards will incur additional costs.
Converting domestic payment cards from magnetic cards to chip cards is one of the tasks approved by the Prime Minister in the Project on developing cashless payment. Deploying this task, on October 5, 2018, the Governor of the SBV issued a set of domestic chip card standards, detailing Vietnam’s domestic card specifications, which are compatible with EMV international standards, preventing tampering. card in physical environment through ATM and POS channels.

The State Bank also issued Circular 41, stipulating the roadmap for conversion to chip cards, the conversion schedule for card acceptance devices at point of sale operating in Vietnam as for card payment organizations until December 31. / 2020, and domestic card issuers in circulation 31/12/2021.

Mr. Nguyen Dinh Thang, Chairman of LienvietPostbank’s Board of Directors, said that when applying the chip card, the system of technology must change, the terminal system, ATM, POS system must change … That entails very costly expenses. big. In addition, changing chip cards for customers also takes time.

Sharing the same view, Mr. Tran Cong Quynh Lan, Deputy General Director of Vietinbank said that when changing to a chip card, the bank had to change a series of machines, the cost of issuing a chip card is also much higher than a magnetic card. However, banks have realized that it is necessary to convert and are determined to transfer magnetic cards to chip cards, turning challenges into opportunities. How can chip cards be integrated and synchronized to pay a lot of expenses such as education, health care, insurance and not merely keeping an ATM account?

According to Mr. Nguyen Quang Hung, General Director of Vietnam National Payment Joint Stock Company (Napas), the bank has made a strong movement in this form of payment. As evidence, at the beginning of the year, there was a ceremony to launch chip cards, when only 7 banks participated. But now Napas and more than 20 banks are ready to switch technology to chip cards.

(Source: Life Science Newspaper)