UAE urged to adopt chip-and-pin

More secure card technology needed to stop repeat of last week's wide-scale fraud, experts say.

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By  Dylan Bowman Published  September 13, 2008

UAE banks are being urged to adopt chip-and-pin technology to prevent a repeat of last week’s wide-scale card fraud, in which potentially thousands of customers had money stolen out of their accounts.

Experts have said chip-and-pin technology, used in Europe and other developed nations, would make the country’s banking system much more secure and reduce the possibility of a repeat of the fraud, UAE daily Emirates Business reported on Saturday.

With chip-and-pin technology customer information is held on a microchip in the card, more secure than the conventional magnetic strip, and a PIN number rather than a signature is used to verify some is the genuine cardholder.

Last week thousands of people were frantically calling bank customer care centres and queuing at ATM machines after receiving SMS messages warning them to change the PIN numbers on all their debit cards.

Some customers also had their cards cancelled as banks scrambled to limit the extent of the problem after a spree of fraudulent withdrawals from both inside and outside of the UAE.

Lloyds TSB, HSBC, Citibank, National Bank of Abu Dhabi and Dubai Bank are among lenders that have sent statements warning customers of the threat.

Banks have been reluctant to reveal the scale of the fraud, with Dubai Bank the only lender so far to detail how many of its customers have been affected – standing at 42.

No bank has revealed how much money has been stolen, although there have been reports of individuals losing up to 26,000 dirhams ($7,000). Most banks have agreed to reimburse affected customers.

3926 days ago
CardSwitch Technology Ltd.

We in CardSwitch Technology Ltd, offer a system that enables cardholders to apply an 'electronic' lock and key to their cards. Our system enables cardholders to set their own user limits, thereby blocking and unblocking their cards at will. Our system makes it quite useless for hackers/fraudsters to skim cards. Some of the banks in UAE are aware of our solution. Card Skimming will be a thing of the past once our system is utilized by the cardholders and the issuing banks.

3929 days ago
Boby Joseph

I have in past years repeatedly asked the banks if they would give me a CHIP based credit and ATM card, and many a times the customer support exec did not even understand what was I referring to and many a times I was given an explanation 'It is relatively safer here', However, I was always paranoid on this magnetic strip because, school kids could just decode it and copy it, and my experience has been most of the shop keepers even failed to verify a signature. However, the fraud here can be of any type and chip and pin will offer no security if the data has been siphoned off at the back end and if they would have entered backdoors. Hence, the only way the bank can protect you is periodically check and plug a hole and inform the customer to change the PIN, that I think most of the banks did this time. However, electronic lock and key is the same as a mechanical lock and key hence, the only best security is to minimize the damage and make it difficult and expensive for hackers to open through. Having said, that there will never be a fool proof and impermeable system exactly like there can never be a lock which can not be opened.

3929 days ago
Alex Malouf

Amazing. The banks mess up so the customer suffers. Even though my bank Standard Chartered was not involved they're insisting on changing the pins even for us souls traveling outside of the UAE. Plus is anyone picking up at their call centre? No. So what do we do? Cut business trips short so we can access our own money? This whole mess is a disgrace and I couldn't imagine it happening anywhere else.

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