ATM alert! These credit cards, debit cards will stop working; do you hold any of them?

Yes, you read that right! Your credit cards and debit cards will stop working and it would be better if you check whether you hold any of them. In fact, of late you might have received a message from your bank that your credit and debit cards will stop working after December 31, 2018 if you do not get them replaced with newer versions. If you did not take cognisance of that message then you may have to bear the consequences at the last moment. To save yourself from any such trouble or emergencies, you should rush and get this problem fixed. You still have time, just visit your bank and get your old credit cards and debit cards replaced without paying any fee. 

This development is in the wake of a directive issued by the Reserve Bank of India (RBI) which had asked the banks to migrate to EMV chip and PIN based credit and debit cards by December 31, 2018.

In the new credit cards and debit cards, EMV chips are placed close to the top of left edge, and look similar to the chip on a SIM card. The EMV chips-based cards will now replace the older cards, which are packed with a magnetic stripe at the back. 

The EMV chips-based cards provide more secure means of digital transaction, while the magstripe cards are easier preys to banking frauds like skimming.

The RBI order had stated that the magstripe cards should be replaced with EMV chip-based cards by the end of this year. 

According to reports, the EMV chip stores payment data on a chip-enabled payment card with support for dynamic authentication. The card therefore, generates dynamic data every time it is used for a transaction, making it impossible for fraudsters to copy user data off the credit/debit card.

On the contrary, the magstripe card stores user data on a magnetic stripe capable of static data authentication only. This made fraudsters to copy data from them. The RBI directive was to ensure additional layer of security. 

Banks had requested RBI to extend the December 31 deadline for migrating to EMV chip-based credit/debit cards, but their plea was rejected by the central bank.

Three months ago, the RBI had also instructed banks to stop using non-CTS cheque books from January 1, 2019. The banks have also asked their customers to get their old cheque books replaced.