The regulation aims to protect customers from a repeat of a massive fraud in 2010.
Bank Indonesia (BI) has officially required banks to shift their ATM and debit cards to chips from the current magnetic strips to protect customers from fraud.
The regulation — effective last Tuesday in conjunction with the release of the central bank’s circulation letter for the banking industry — includes a lengthy transition period lasting until Dec. 31, 2015, said BI director for accounting and payment systems Ronald Waas.
“We want cards to be safer, to avoid a repeat of a massive fraud in 2010, because the data in the cards can be easily stolen. With chips, we expect the data to be safer,” he told a press briefing at his office in Jakarta on Tuesday. The chip card will ask for an at least six-digit personal identification number (PIN) to operate, Ronald said.
There will be 78 million chip cards circulating in the country by 2016, 23 million more than the current 55 million, which need to be shifted, he said, citing 8,000 of the current 40,000 ATMs which are not ready to read the new chip cards.
“Starting Jan. 1, 2016, across Indonesia, every transaction using ATM and debit cards issued by Indonesia-based issuers must be processed using chip technological standards with PINs of at least six digits,” BI’s circulation letter reads.
“Every transaction using ATM and debit cards issued by issuers outside Indonesia could be processed according to the existing technology.”
View the full story in The Jakarta Post.
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