The supervisor of banks at the Bank of Israel David Zaken has ordered the financial services industry to switch customers to credit cards with the EMV security standard within three and a half years, replacing the typical magnetic strip.
Globes reports the move has been put in place to reduce the amount of card fraud and the process of issuing new cards and upgrading ATMs and point-of-sale terminals will cost tens of millions of dollars.
This follows on from the European switch that happened many years ago and has been a success in terms of lowering fraud rates. The US is currently migrating to the technology and aims to have the process completed by 2015.
The new EMV model helps prevent fraud by making it more difficult to create counterfeit or cloned cards and countries that have established it as the standard have seen a large drop in fraud.
However, implementation of the technology is not cheap and the Bank of Israel should expect to spend a lot on making the transition.
By Gary Cooper