Nedbank denies smart card failure

By Candice Jones for Nedbank
Johannesburg, 07 Jan 2008

Nedbank has refuted allegations that new chip and pin card systems have had to be rolled back to earlier systems, saying there have been no problems at all.

This follows claims over the holiday period that the financial institution's smart card systems had been plagued with problems.

One source close to Nedbank's roll-out operations alleged the EMV system facilitating the use of smart card technology crashed each time a transaction was performed. This resulted in the bank being forced to revert to the magnetic stripe standard, he revealed.

However, Kobus van de Venter, Nedbank's head of card innovation, says the institution is not aware of any problems and the roll-out has thus far been successful.

"We ramped up chip issuance significantly during October and November 2007 and are issuing very significant volumes into the market - both new, replacement and reissued cards. EMV chip and pin cards are being issued to cardholders already on new products launched, such as the Proshop Golf Card and a number of the Nedbank Affinity card portfolios," he explains.

"Nedbank merchants already acquire thousands of chip transactions every month performed by overseas tourists to South Africa," he adds.

Roll-out planning

The remaining products will be migrated in batches at a pace dictated by "customer experience", he explains.

"Issuing of chip cards will be ramped up to replace all magnetic stripe cards over the next two years, according to the card replacement cycles."

Nedbank says its merchants have already received terminals upgraded to process "chip and pin" cards and merchant personnel have been trained to transact with the new types of cards. Additionally, the bank is in the process of delivering mobile or handheld point-of-sale terminals at restaurants, filling stations and similar outlets where portable devices are needed.

Van de Venter says Nedbank expects full EMV compliance by mid 2008: "Good progress has been made by Nedbank and the retailer groups we service."