KUALA LUMPUR -- Singapore banks have yet to decide on whether to convert their ATM cards and ATMs to chip-based technology, in the wake of a recent recommendation from Malaysia's central bank, according to a report from the Bernama news service.
Bankers said that switching from cards with magnetic strips to chip technology might not reduce the risk of fraud and would have to be an industry-wide decision to be successful.
DBS' head of consumer banking, Edmund Koh, said, "Having individual banks doing it doesn't resolve the situation as a key issue to consider is the usability of the cards at other banks' terminals."
Koh said that banks may still have to produce cards with magnetic strips, even if they carry chips, to allow their customers to use their cards to withdraw cash at ATMs in other countries which do not employ chip-based technology.
Koh said that DBS was not ruling out adding chips to its ATM cards but has to consider issues like the cost of implementation.
A United Overseas Bank (UOB) spokesman said the bank had not decided on whether to add computer chips on its ATM cards.
A Bank Negara spokesman said that it had recommended that banks in Malaysia add chips to their cards.
Malaysian police earlier this year busted a syndicate that used "skimming" devices to read the information off ATM cards' magnetic strips when they were inserted into the machines, and then produced around 400 cloned cards to steal an estimated 1.2 million ringgits(approximately $316,000 U.S.) from other ATMs. (See related stories Malaysian thieves siphon money from accounts and Malaysian authorities warn banks about ATM fraud)
Several Malaysian banks announced their intent to switch to chip-based ATM cards in an effort to reduce fraud (See related story Malaysian bank fast tracks ATM smart card program)
There have not been any cases of skimming at Singapore's ATMs so far, but the ATM card of a DBS Bank customer was recently cloned in Malaysia, where she had used it, and then used to withdraw 8,000 ringgits (approximately $2,100 U.S.) from her account.
The Monetary Authority of Singapore (MAS) said banks were directly responsible for the safety and soundness of the services and systems -- which include devices, equipment, software and hardware-they provide to customers.
"It is up to the individual banks to decide on the appropriate time and place for introducing smart cards or other replacement devices," a MAS spokesman said.
