TAIPEI, Taiwan -- The Financial Information Service Co, a company that operates interbank information networks, plans to replace more than 60 million ATM cards in the nation with integrated circuit (IC) cards starting in September.
According to a report in the Taipei Times, the intent is to create a more secure transaction environment.
"We expect ATM cards will completely disappear over the next five years," Pan Wei-jong, associate manager of the company, told the Times. "ATM card fraud will be largely reduced by that time."
According to an agreement reached with the Bankers Association, 23 financial institutions including First Commercial Bank, Changhwa, Hua Nan Bank, Bank of Taiwan, Cosmos Bank and E. Sun Commercial Bank Ltd will begin to issue the new cards on Sept. 15.
Another 52 banks are expected to launch the new cards by next June, Pan said.
Although IC cards are more secure than magnetic-strip cards, Cheng Jen-hung, secretary-general of the Consumers' Foundation
The company recently decided to pay NT$230 million ($6.6 million U.S.) to 49 banks that incurred losses from the incident.
"Banks that issue IC cards should improve management of card holders' information," Cheng said. "The risk may also come from aspects other than technology."
Currently, about 7,000 of 17,000 ATMs in Taiwan can read IC cards. The remaining 10,000 must be outfitted with new card readers to facilitate the measure, Pan said.
The total cost for installing the IC readers is an estimated NT$1 billion ($29 million U.S.), according to Chinese-language newspaper reports.
In addition to replacing ATM cards, the company is planning to develop IC cards into fuller-function smart cards that can be used to make retail payments and function as phone cards and subway tickets.
"Due to its convenience for making transactions, the cards can further spur on consumption," Pan said.
