Russia to fight credit cards fraud with chips
The Central Bank of Russia has decided to oblige all Russian credit institutions to introduce a special chip into bank cards to protect clients from fraud, writes Kommersant. Only 30 percent of banks in Russia have cards with both a chip and a magnetic strip, 20 percents of banks are issuing cards only with chip, and 50 percent of banks has card with just a magnetic strip, the CBR said.
Installing special devices into cash machines to read personal identification number (PIN) and other codes from a banking card, also known as skimming, has become the biggest issue for Russian cardholders. The number of such crimes has been growing by an average of 23 percent a quarter, the CBR estimates. This ranks Russia 5th on the list of countries for this type of fraud, according to FICO data.
Approximately 80 percent of Russia's ATMs are equipped to accept chipped cards, with a 100 percent switch expected in 2016.
A switch to chipped cards will create extra costs for banks, but these would be minimal compared to bank losses from card skimmers, said Elman Methiev, a board member at GE Money bank. ■