Cebu banks are on track to full EMV migration

The Cebu banking sector is on track to full transition to EMWenabled cards, a top official said.

Cebu Bankers Club president Mario Fritz Palileo believes that as far as commercial banks are concerned, they are now 95 percent compliant to the mandate to make ATM cards EMV (Europay, Mastercard and Visa) chipenabled.

Palileo told The FREEMAN yesterday he is also set to meet the organization's member banks to determine the banks that have completely shifted to EMV and those that are still on the process.

"For commercial banks my assessment is about 95 percent compliant," said Palileo, assistant vice president at Unionbank of the Philippines.

He noted local banks are on track on the migration.

He said the EMV technology is key to minimize the cases of card fraud and skimming.

The Bangko Sentral ng Pilipinas had given banks until June 30 this year to fully comply with the EMV shift mandate.

The central bank has pushed the banking industry towards full adoption of EMV technology at a much faster pace.

Failure to meet the June 2018 final deadline will subject banks to monetary sanctions.

Banks are told to raise awareness as well as manage customers’ expectations on the replacement of their payment cards including debit and credit.

Banks should also intensify their public awareness programs leveraging on all available communication channels.

"The information should clearly indicate the date when EMV cards are available and ready for pick-up by their clients as well as the related procedures for replacing magstripe cards and distributing EMVcompliant cards," the bank regulator had previously noted.

Banks are further expected to develop strategies to entice or force clients to replace their old cards with EMV cards such as deactivation of existing cards by certain date, offering of rewards or freebies, and/or liability shift for skimming incidents.

Earlier, the country’s leading lender BDO Unibank said it expects to complete by Feb. 1 the migration to more secure EMV cards for its first batch of retail clients.

EMV chip-enabled cards have enhanced features that verify transactions made on card, minimizing cases of card fraud incidents and identity theft.

The regulatory requirement to shift to EMV is part of the banking industry’s move to boost protection against fraudulent activities usually carried out in electronic banking channels.

Last November 2014, the Bangko Sentral had required all supervised financial entities with debit and credit card issuing and acquiring functions to migrate their entire payment card network to the more secure EMV technology.

The EMV electronic chip technology is designed to give tighter security and prevent ATM card fraud incidents.

EMV is a global standard for chipbased credit and debit transactions and is deemed more secured than the magnetic stripe technology which is currently used in most bank-issued cards in the country.

The chip-enabled cards also carry additional security layers and can carry a bigger amount of data than the magnetic stripe, which is widely used in the old ATM cards.

It was in August 2013 when the Monetary Board approved an enhanced Information Technology Risk Management (ITRM) framework that requires Philippine banks to eventually shift to EMV technology.