Sterling Bank of Asia’s phase out of magnetic stripe ATM cards 52% complete
Sterling Bank of Asia has begun the process of migrating its automated teller machine cards to the more secure EMV-chip enabled cards and hopes to complete the process well ahead of the 2017-deadline required by the Bangko Sentral ng Pilipinas.
The BSP issued Circular 808 signed August 22, 2013 laying out the guidelines for information technology risk management that will phase out magnetic stripe cards by 2017.
“We at Sterling Bank were ahead in the use of EMV cards, issuing them to clients as early as 2008. Right now, 52 percent of our cards already have EMV chips,” Sterling Bank president Lamberto Villena said.
EMV, or Europay Mastercard Visa, chip cards offer better protection from fraud than magnetic stripe cards. EMV chip cards have unique authentication process and the data in the cards are more difficult to copy than those in magnetic stripe cards. It is when data in an account is copied by unscrupulous individuals that fraudulent transactions may take place.
EMV is the global standard for chip-based credit and debit transactions that ensures security and global interoperability.
“Clients put their money in banks because of the security they offer. This is why when we launched ShopNPay Visa debit & prepaid cards in 2008, we anticipated that the EMV chip would become the standard in card security thus we started issuing the first Visa EMV card locally to our clients to safeguard their accounts,” Villena said.
Aside from the improved security, EMV cards are also more robust than magnetic stripe cards and can support applications such as secure internet access for e-commerce, loyalty schemes and secure site access. The EMV cards also open up new merchant segments that were previously deemed too risky or were previously reluctant to credit and debit programs because of the tedious online authorization process.
The BSP’s directive was triggered by the increasing reports on fraud traced to the use of ATMs with magnetic stripe cards and is meant to minimize the risk for fraud.