News

Taiwan begins switch to chip cards

June 29, 2004

TAIWAN - Beginning next month, holders of ATM cards will have to upgrade to integrated-circuit or smart cards in a bid to counter the increasingly severe problem of card fraud. 

According to a report in Taipei Times, the Bankers' Association of the Republic of China has said thatinter-bank transactions via magnetic cards will end in 2005, which will gradually eliminate the more than 64.5 million magnetic cards currently in circulation.

Though some banks will issue IC-embedded cards used for cash withdrawals only, others are expected to launch cards which combine cash withdrawal, credit, cash advance, stored value and debit functions on a single card.

Combination cards will give banks an opportunity to expand their credit card market share when their savings account customers upgrade their magnetic cards, according to the Taipei Times.

Chinatrust Commercial Bank, which has more than three million bank cards in circulation, is expected to convert two million cards by the end of 2004, according to the bank's public relations department.

Chinatrust will not issue combination cards, but only chip-embedded cards.

Hua Nan Commercial Bank will offer gifts to customers who apply for combination cards starting next month.

According to figures provided by the government-funded Financial Information Service Co., 14,550 ATMs, or 73 percent of all cash machines in the country, had been modified to read chip-embedded cards by June 25.

See related stories:

Taiwan to spend $430M to convert ATM cards to chip

Some Taiwan banks may not meet accelerated ATM card conversion deadline

ATM fraud driving move to chip cards in Taiwan