Your Debit card may not work in ATMs or malls from January 1, online banking on your account will continue
If you have an old debit card, brace for some inconvenient time in New Year from January 1, 2019. If you are using an old credit or Debit/ATM card, chances are it may not work from tomorrow.
HIGHLIGHTS
*Bank users have to use cards with a security chip inside them.
*Even if your old debit or credit card stops working, it will not affect your bank account.
*RBI has mandated EMV chip cards to protect customers from online banking fraudsters.
If you have an old debit card, brace for some inconvenient time in New Year from January 1, 2019. If you are using an old credit or Debit/ATM card, chances are it may not work from tomorrow. This is because it lacks the magnetic strip in it.
According to a directive issued by the Reserve Bank of India, all the banks operating in India have been asked to get rid of old magnetic stripe cards that are easy to clone and can be used in other bank frauds. Instead, bank users have to use cards with a security chip inside them.
However, if it is a consolation, even if your old debit or credit card stops working, it will not affect your bank account. In other words, a lot of functionality for which you use an ATM through a debit or credit card, you will be able to do with online banking or through the official app from your bank.
According to the RBI directive, all magnetic stripe cards must be replaced by EMV chip-based cards by December 31, 2018. This means that your magnetic stripe cards may stop working from January 1, 2019 and you may not be able to withdraw money from ATMs, swipe the card at malls or in any other point-of-sale machines. The directive is applicable to all domestic as well as the international debit and credit cards. RBI had issued this notice in 2015 after which the EMV chip-based cards came in use in January 2016.
RBI has mandated EMV chip cards to protect customers from online banking fraudsters. The cloning or duplicating of debit and credit card is one of the popular ways for committing online banking forgeries. The magnetic stripe cards are less secure than EMV chip-based cards and can be easily duplicated.
The reason is that the magnetic stripe cards stores user data on a magnetic stripe which is static and does not support dynamic authentication. The information is stored in a static form in the black strip that you see at the back of your card. The EMV or Europay, Mastercard, Visa chip cards also have static data authentication but they support dynamic data authentication which makes them difficult to clone. They come with better data encryption standards and storage technology in comparison.
The replacement of old debit and credit cards with the new EMV chip-based cards is bank's responsibility and is free of cost. Banks have to bear the cost of the new EMV cards.
Using the EMV chip cards will require you to enter a PIN when you do a transaction through a point of sale (PoS) machine. While the transaction using the magnetic stripe cards required you to just swipe it in the machine, the EMV chip-based cards will ask you to enter PIN also that adds an extra blanket of security.