By India Today Web Desk: Banks are sending messages to every account holder to upgrade their debit and credit cards You must have received such a message. But there are chances that you may have ignored the message by mistaking it for spam. Check the message again, it’s not spam. This is a useful message from the bank where you deposited your money. Now, if you haven’t already, you need to replace your existing debit and credit cards with new ones
But why take such pains and replace debit and credit cards? Legally speaking, the Reserve Bank of India (RBI) has directed banks to do so. After December 31, old debit and credit cards will become useless.
Banks have to comply with RBI directives. This instruction of RBI was necessary to protect you from some unscrupulous online predators. Your money must be secured with the bank. It is their responsibility. Debit and credit card piracy is a major problem, as is online banking fraud. New chip-based cards are set to keep your money and transactions safe.
Existing debit and credit cards are magnetic stripe cards only. Cloning them poses a major challenge for those responsible for secure financial transactions. The new cards are EMV chip-based EVM stands for MasterCard, Visa in Europe. The old magnetic stripe-only debit and credit cards will be replaced by EMV chip-based cards by 31 December 2018.
Replacement of existing debit and credit cards with the new EMV chip-based cards is free The cost of the new card is borne by the bank. EMV chip-based debit and credit cards have been in use since January 2016 RBI has made it mandatory for banks to issue only EMV chip-based cards for new customers to open new accounts or apply for new debit or credit cards after 31 January 2016. .
The RBI guidelines apply not only to all domestic but also international debit and credit cards. Existing magnetic stripe-only cards will no longer be valid after the Dec. 31 deadline.
EMV chip-based debit and credit cards are more secure than magnetic stripe cards. Chip-based cards are also called PIN (Personal Identification Number) cards. These cards use high standards of data encryption and have advanced storage technology.
Magnetic stripe cards have static information stored on the black strip that we see on the back of the card. An EMV card stores customer information in a dynamic format. This change in technology makes card cloning difficult.
New debit and credit cards require little change in habits, especially for completing transactions through Point of Sale (PoS) machines. Transactions through a PoS device can be done using a magnetic stripe card only by swiping it while a PIN will also be asked to transact using the new chip-based PIN card. This gives the user an extra layer of security.
Still, online transactions will continue to pose risks if you share sensitive card-related information with strangers or someone you don’t trust.
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