Vietcombank continues to offer free conversion from magnetic stripe card to chip card

Conversion of cards from technology to chip technology is a requirement for commercial banks (commercial banks) in the period of 2020-2021.

This is the opinion of Ms. Nguyen Hong Van – Director of Vietcombank’s Card Center when discussing the bank’s plans and the challenges of implementing chip cards.

As a pioneer bank and the implementation of the conversion of technology cards from chip technology, can you tell us about Vietcombank’s implementation plan and initial results to date?

Ms. Nguyen Hong Van: Since September 2019, Vietcombank is one of the first banks in the market to launch a new issuance and convert domestic technology Debit cards from to Chip Contactless technology. and upgrade the system of card payment machines (EDC) as well as ATMs throughout the system to ensure the acceptance of Chip cards according to the set of grassroots standards, meeting the requirements of the Conversion Path according to Circular 41 of the State Bank. (SBV).

Although it is one of the banks with the largest number of domestic cards in circulation as well as the largest EDC and ATM system in the market, the conversion cost is very large, but to try to support Vietcombank customers is still maintained. maintain free conversion policy for customers from magnetic card to Chip card. The implementation of free conversion as well as the effort to convert in the shortest time to bring customers a Chip Contactless technology card product safer, increase payment convenience, shorten time. payment space for customers….

Vietcombank has issued and converted over 1 million Chip Contactless cards and upgraded over 50% of EDC, nearly 70% of ATMs accept Chip cards according to the standard set throughout the system.

In addition to the large conversion costs because the bank has the largest number of circulation cards in the market, the ATM system and the EDC system are also the largest, what difficulties does the bank face?

Ms. Nguyen Hong Van: It is true that conversion costs are a common challenge of banks because the cost of chip cards is much higher than that of magnetic cards. For banks with large circulation cards, large EDC and ATM systems such as Vietcombank, the challenge is even greater. With the number of ATM and EDC replacements to accept large Chip cards, the investment costs are large, and the procurement and replacement of ATMs takes time, while Vietcombank still needs to ensure the number. ATM and EDC to serve the needs of cash withdrawal, spending of people. As one of the banks with the largest number of cards in circulation, Vietcombank needs to add individualization capacity to meet the conversion productivity. The cost of procuring individualized / outsourced systems, or upgrading the Chip transaction processing system is also a burden for banks.

In addition, due to the impact of COVID-19, the implementation of updating the device to accept Chip card payment is difficult because it is not possible for models that need to be updated directly at the EDC / ATM machine. .

In addition, the lack of synchronization and synchronicity in the conversion between banks will limit the acceptance of domestic chip card payment, causing bad experiences for customers.

Finally, it is the willingness and cooperation of customers, because the State Bank’s plan to convert the issuance plan according to the SBV’s plan depends very much on the willingness and cooperation of customers.

From the beginning of the year until now, Vietcombank and many banks have reduced fees for customers, what do you think the banks will do if they receive the request for further discount?

Ms. Nguyen Hong Van: In fact, for the card service segment, banks have to invest a lot, with huge costs for the items of investment in infrastructure of card transaction processing systems, ATM / EDC, maintenance and maintenance of ATM / EDC system … especially in the current period, banks still have to invest in upgrading ATM / EDC system / processing system / multi-layer security system to comply. comply with the requirements of the management agency to ensure service quality and safety for card payment transactions and to ensure compliance with the new and high-tech payment trends. In addition to the above costs, the plan to convert cards in accordance with VCCS standards as prescribed by the State Bank for the whole market also caused Vietcombank and banks in Vietnam to spend a lot of money to buy Chip cards and billets. system, and conversion costs for customers, but with the goal of bringing products and services with high technology content, safety and convenience, meeting the high demand of customers, we still is supporting free conversions for customers.

In addition to investment costs, the costs payable to parties involved in card payment activities are also quite large, namely in the card service supply chain, the Bank is only one party in the service supply chain for customers. line. The Bank must pay transaction processing fees and copyright fees to international card organizations (ICD), Vietnam National Switching Company (NAPAS), telecommunication partners (transmission lines, messages) and other other partners (renting premises for ATM …).

Currently, the Banking Association has issued a letter proposing to request international banks to have policies to support banks in fees (such as reducing transaction processing fees, interchange fees …), if accepted by international credit institutions, banks The new budget will support customers and re-invest to improve the quality of services, but reaching a consensus on fee reduction with ICD is very difficult and takes time.

In addition, as the director of a foreign bank in Vietnam recently reflected in statistics, the telecommunication network’s fee for its SMS messages is three times higher than that of regular text messages. However, SMS is still one of the important components for banks to implement electronic payment activities in general and card payment in particular.

The Banking Association has also sent telecom operators a proposal to reduce SMS charges to assist banks to cope with the impact of the Covid epidemic – 19.

In my opinion, the bank is maintaining, using SMS is an essential need to ensure safety and peace of mind for customers when using online banking, card payment. However, due to the negative effects from the COVID-19 epidemic, the bank also needs a handshake from the network operator through the reduction of SMS charges. This will not only help ease the burden on banks, but will also bring practical benefits to customers of both parties.

In recent years, NAPAS Company – a partner in the payment service supply chain has reduced fees and banks also shared the fee reduction to people. In the coming time, we will wait for other partners in the payment service supply chain other from the international payment organizations, carriers … to take similar actions.

Sincerely thank you!

Source: http://baochinhphu.vn/Doanh-nghiep/Vietcombank-tiep-tuc-mien-phi-chuyen-doi-tu-the-tu-sang-the-chip/394811.vgp