Standard Bank said on Tuesday that it is issuing about 20 000 chip and PIN bank cards a month as part of an ongoing exercise to match international standards and sharply improve card security.
The group said in a statement that card skimming is again on the rise and it is warning customers to be especially vigilant against criminals trying to access data from the magnetic stripes on credit and debit cards.
Standard Bank says it is the first major bank in South Africa to embark on the widespread roll-out of security-enhanced, chip-encoded credit cards (chip and PIN cards) to its customers.
More than 180 000 customers have already been issued with these cards by the bank, which intends to increase the roll-out volume to more than 100 000 cards a month later in the year.
Card skimming usually takes place when criminals capture data by using the same sort of devices that are used for legitimate point-of-sale or ATM transactions. Automated and high-tech methods being used include PIN pad overlays, hardware that attaches inside point-of-sale terminals and key-stroke loggers.
Leon Barnard, director of secured lending and credit cards at Standard Bank, said: “While skimming has been around for some time, banks have taken the initiative to combat this type of fraud. All of South Africa’s major banks are adopting chip and PIN card technology.
“Chip and PIN cards form the foundation of a new, convenient and secure card-banking platform. Consumers are still urged to remain vigilant and adopt secure transaction practices when swiping [cards at] or drawing from an ATM. At issue, though, is the varying rate at which this functionality is being rolled out between the major banks,” he said.
Chip and PIN cards are much safer than magnetic-stripe cards as they require the keying in of a PIN number before a transaction can take place. The new cards have a chip, together with the normal magnetic stripe, providing an extra layer of security for the bank, card holders and merchants.
In many cases, card holders will not only be required to key in a PIN, but may also have to provide a signature before a transaction can be successfully processed.
Unlike cards that only have a magnetic stripe, chip and PIN cards are very difficult to clone, sharply reducing the ability of criminals to copy cards and transact fraudulently on them. It is practically impossible to copy a chip card, Standard Bank says.
Importantly, chip and PIN cards carry no more personal information about card holders on them than existing magnetic-stripe cards, allaying fears in some quarters that chip technology will make unwelcome inroads into individual privacy. — I-Net Bridge