Malaysia's Banks Optimizing EMV Card Services
The Star Oct 19 2004:
As Malaysia and the Asia-Pacific region move to EMV chip card systems, service providers like Cassis are gearing for a value-added market that could be worth RM 100 million per year by 2008. Malaysia is due to be EMV-compliant by end-2005 and Cassis is positioning to deliver cardholder-centric services to enable banks to maximize their EMV investment. Southern Bank, United Overseas Bank and Public Bank are already using Cassis’ services to build customer retention by choosing the best value-added products to load onto customers’ new EMV cards and reduce the chances of those customers switching banks.
If banks want to tie EMV chip cards to their customer relationship management (CRM) systems, Cassis is able to manage the actual EMV cards and the security information on behalf of the bank. A bank wanting to give a customer secure access to its Internet services for example can load an application onto an EMV chip card to facilitate one-stop log-in and security protection. Malaysia has about 6 million credit and charge cards at present, but Cassis is confident of capturing over half of this market and of extending its expertise across the region with a view to entering additional world regions over time.
Malaysia, which has one of the highest credit card fraud rates in the world (RM 242.5 million in 2003) migrated its debit card base to EMV by end-2003, and is due to convert its credit cards by end-2005. The number of credit cards in issue by 2008 is predicted to be 2.6 times that in 2003, with transaction value and volume keeping pace with growth trajectories. Euromonitor predicts credit cards in this market to have an average annual growth of 21 per cent in terms of cards in circulation through 2008, while charge cards will grow by 16 per cent on average per year in the same period.
Europe's Banking Industry Delaying EMV Rollouts
Tekrati Nov 04 2004:
European banks’ EMV readiness has been delayed by high EMV investment costs, lack of bank internal expertise and the inability to issue smart cards in-house, according to Frost & Sullivan. By 2008, the bank market for smart cards will total USD 1196.3 million, up from USD 453.3 million, a new report reveals, but to date, banks' EMV rollouts have been limited by legacy infrastructure and costs. Banks are postponing the expense of integrating legacy systems with newer hardware and software, but Frost & Sullivan advises that the card schemes can help by providing incentives for EMV upgrades.
In a non-EMV smart card project, French bank Credit Agricole is using card-based authentication for its Internet banking services, to allow its customers to digitally sign bank transfer documents and to file tax claims via the Internet. Static passwords are no longer a secure way to validate customers who wish to access remote banking services due to the rise of ‘phishing’, or the illicit solicitation of consumers’ financial details online by criminals. To this end Credit Agricole opted for smart cards as a future-proof, universal solution that supported two-factor authentication and were easy to use.
Malaysia's Card Fraud Growth Labeled 'Alarming'
The Star Tribune Aug 11 2004:
Credit card fraud in Malaysia topped RM 100 million (USD 45 million) in the first half of 2004, according to the Agency for Combating Trade-Related Crimes, which sees this growth rate as ‘alarming’. Malaysia has an advanced payment network, on which transactions rose to 145 million in 2003, up from 127 million in 2002. Banks have however lost heavily to counterfeiters from South Korea, Japan, Hong Kong, Spain, Britain, the Netherlands, South Africa and Egypt. Malaysian officials have called for stricter checks in the card issuing process, and for greater collaboration between banks and police in fighting financial crime.
With Korea, Taiwan and Malaysia now investing in EMV technologies, Bruce Thompson, CEO of regional e-payment solutions firm, Keycorp, believes banks in Australia and the US will rethink their stance on chip cards as fraud migrates to countries still relying on magnetic-stripe cards. Card fraud in Sydney has risen noticeably as smart cards roll out in neighboring countries, which leads Keycorp to predict that within three years, Australia will transition from mag-stripe, to chip cards. Thompson concedes that smart card infrastructure is expensive, but argues that smart cards provide benefits other than fraud prevention.
On that note, Malaysia-based wireless solutions firm, Cassis, is preparing to leverage EMV technology for secure mobile phone-based payments at the retail POS, and indicates the banks to have expressed an interest in its system. Cassis’ EMV technology, which is about to rollout in South Korea, enables the over-the-air download of a credit card payment application to the USIM card in a subscriber’s handset. Banks seeking to optimize their EMV investment can for example rent ‘space’ on a SIM card, on which multiple credit cards can be loaded, and work with telcos to strengthen the brands of both entities.