A press release by FEBELFIN (Belgian financial services association) yesterday (here in Dutch) states that from 17 Jan 2011 Belgian
Maestro cards can no longer be used outside of continental Europe.
Today I received a letter from my bank confirming the announcement and blaming it on the need to 'protect my transactions from fraud'. Essentially this means that I now have a choice if travelling to the US (or EMV countries like Canada, South Africa or
Malaysia...) to either change cash before going or to use a credit card.
This appears to have been made possible by a change in the Maestro Europe Rules (Global rules chapter 19, section 6-8 for the interested few) which now allows selective authorisation on the basis of geographical location. But what does this mean for global
interoperability? Is this the beginning of the end of global schemes, more pressure on the US or just a sledgehammer to crack peanut?
Maybe it is the beginning of the end for the magnetic stripe? Particularly if other European countries follow suit - as fraudsters perpetrating card skimming in Belgium look elsewhere.
Once replacement cards are eventually issued as 'Chip only', it's likely that the restrictions on use in EMV countries outside Europe may be lifted and there will be a new global interoperability standard......EMV.
This certainly brings more pressure on the US, but then already their cardholders are unable to use their 'stripe only' cards at many European payment terminals, as well as at an increasing number of payment terminals outside Europe.
....and earlier this week China UnionPay announced that from 2015 Chinese banks will no longer issue magnetic stripe cards, just Chip cards, and the upgrade process has already started.......
....and the recently published 7th SEPA Progress report states that from 2012 onwards, all newly issued SEPA cards should be issued, by default, as “chip-only” cards.
Belgium appears to be ahead of the curve, and heading in the right direction.
© Finextra Research 2016