The shift from magnetic is expected to provide better cardholder protection.
The State Bank of Vietnam (SBV) is accelerating the process of converting 70 million magnetic cards in circulation into chip cards in an effort to protect users against a recent slew of card crimes, according to a report by VietnamNet.
“The shifting will be mandatory,” a high ranking official of SBV told VietnamNet, adding that chip cards are being used in most countries to prevent cases of ATM fraud.
Malaysia has already completed the transition to chip cards as of early this year whilst Thailand has already began the conversion in 2016 and is expected to finish by January 2019. The Philippines has similarly urged banks to issue all customers with EMV chip-enabled cards until the end of June 2018 or face stiff penalties.
Under a plan drawn by the SBV, the conversion would be completed no later than December 31, 2020. However, analysts warn of the costs banks must bear to complete the conversion with the country's four state banks needing at least $50m to fully shift from magnetic to chip cards.
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