IN AN attempt to curb card fraud South African banks have launched the microchipped smart card at an estimated cost of almost R1 billion to replace debit and credit cards.

This comes after plastic card fraud had grown almost sixty percent in the last six months. Smart cards, fitted with new technological features, are able to store information in such a way that it can only be accessed by the cardholder.

Smart cards also restrict fraudsters from reproducing cards and reduce skimming. According to Absa group payment system’s general manager Walter Volker, seven major banks in South Africa decided to work together and formed the South African Europay, MasterCard and Visa forum in a bid to stamp out card fraud.

“We first launched the smart card in 2003 to employees and in March 2007 it was made available to the public,” says Volker.

All Absa merchants have received upgraded paypoint terminals. Business owners who want to ensure that they are equipped to serve people with smart cards can rent these terminals.

“I cannot say what the cost will be as it differs depending on how many people the business services,” says Volker.

The smart card looks exactly the same as a debit card, but the only difference is that the smart card is fitted with a microchip and does not require to be swiped through the terminal.

“You only need to wave the card close to the reactor. It works especially well at fast food outlets,” says Volker.

However, the smart cards still have the magnetic swiping strip for merchants who have not yet upgraded to the new terminals, says Volker.

Business owners interested in replacing their existing debit and credit cards with smart cards can approach their local bank for assistance.

Contact Absa on 0860 008 600.