Israel’s Central Bank announced the country’s domestic payment industry has roughly three-and-a-half years to fully migrate cards from the current magnetic stripe technology to EMV. Bank of Israel supervisor David Zaken pushed the move to reduce the country’s exposure to card fraud.
Israel’s announcement follows the global trend of countries migrating to EMV to help reduce fraud. The migration, however, will not be easy or cheap as the process of upgrading ATMs and point-of-sale terminal as well banks issuing new chip cards will cost tens of millions of dollars at the minimum.
While Israel’s financial institutions will face those significant up-front costs, EMV technology has proven its worth as an effective way to reduce fraud. Industry players likely will see slow returns at first, the migration will eventually save money over the long run as fraud moves to countries as fraud to countries where magnetic stripe cards are still dominant.
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