In order to increase the security in transactions of credit cards and debit cards, banks are replacing the existing cards of their customers. Banks are now offering EMV chip cards as a substitute for the existing magnetic stripe-cards. This step has been taken after Reserve Bank of India (RBI) directed all banks to replace all magnetic-stripe cards with EMV chip cards by December 31, 2018. EMV stands for Europay, Mastercard and Visa.
The older magnetic-stripe credit and debit cards will not be valid after December 31, 2018 and this applies to domestic as well as international cards. Cards whose deadline ends after December 31, 2018 will also be invalid after the December deadline. Therefore, banks are informing their customers about replacement of cards, which will be done for free of cost.
The RBI direction has come in order to better levels of security in debit and credit cards’ transactions. Chip-based cards, also known as chip and PIN cards and are more secure than the magnetic-stripe cards. While magnetic-stripe cards only require a swipe to complete a transaction on (Point of Sale) PoS devices, the chip-based cards also require a pin to complete the transaction. Moreover, the sensitive data in EMV cards is stored in a chip, due to which it makes it difficult for fraudsters to clone the card. The information in the chip is encrypted, which provides extra level of security.
So EVM chip cards help in a great extend to stop physical cloning of cards. But in the case of online transactions, the risks of fraud will still exist, so customers need to take precautions for that. Customers are always advised by banks not to share sensitive card-related data with anyone.
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