New Delhi: It could be extremely troublesome, if there is an emergent need to use credit, debit card after 31 December 2018 as magnetic stripe-based will get invalid from 1 January 2019. The Reserve Bank of India (RBI), earlier this year, ordered that all the magnetic-stripe based credit, debit cards in circulation will be invalid after 31 December 2018 in an aim to reduce possibilities of frauds.
Following 1 January 2019, only EMV chip and PIN-based credit and debit cards will be operational as these type of cards are relatively more secured as compared to magnetic stripe-based cards. On EMV (Europay MasterCard Visa) chip card, a PIN is required at POS (point of sale) while magnetic stripe-based cards don’t demand a PIN.
According to RBI data, there are about 4.1 crore credit cards and 98.01 crore debit cards, as at the end of August 2018. Interestingly, despite of such a huge difference between number of credit and debit cards, the amount of transaction through point of sale via credit cards stood at Rs 47,981.8 crore while through debit cards it was at Rs 48,971.9 crore, as at August 2018.
Following RBI’s move, India’s largest bank by assets State Bank of India (SBI) asked its customers to change their respective magnetic stripe-based ATM-cum-debit cards before 1 December 2018 and said the new EMV chip debit cards will be issued for free. At the end of August, there were 30.7 crore SBI debit cards, RBI data revealed. “As per the RBI guidelines, you are required to change your Magstripe Debit Cards to EMV Chip Debit Cards by the end of 2018. The conversion process is absolutely safe and comes with no charges,” SBI had mentioned in a tweet.