24 February 2018
Visit www.avoka.com

Gemalto books EUR10 million provison against German date-change fiasco

13 January 2010  |  11777 views  |  0 card chip

French smart card supplier Gemalto is to book an exceptional charge of up to EUR10 million in its 2009 results to cover financial claims stemming from a Y2K-related coding error that rendered millions of German payment cards unable to process the 2010 date-change.

The glitch - which affected as many as 30 million payment cards - left consumers unable to use their cards in cash machines and eftpos terminals around the country and also hit German cardholders travelling overseas.

In a statement, Gemalto says it has provided a "secure procedure to its customers in Germany to address the situation". The unspecified remedial measure was approved by the German banking authorities on 7 January.

Initially it was feared that the vendor would be forced to replace the affected cards, a move experts estimated could cost up to EUR300 million.

Olivier Piou, Gemalto CEO says: "This is a regrettable incident, and we are doing everything in our power to support our banking customers in resuming full normal operations. We worked with them hand-in-hand to create a strong secure software solution that enables our customers to resolve the problem of the concerned cards without reissuing these cards."

Nonetheless, the vendor is expecting a string of claims from retailers and banks relating to lost sales as a result of the malfunction.

Piou says Gemalto will take a special provision of EUR6-10 million to cover the "potential consequences related to this event". The charge will be booked as part of the vendor's 2009 results, reducing expectations of around EUR180 million adjusted Ebit for the year by the same amount.
KeywordsFINDEX

Comments: (0)

Comment on this story (membership required)

Finextra news in your inbox

For Finextra's free daily newsletter, breaking news flashes and weekly jobs board: sign up now

Related stories

Millions of German bank cards hit by Y2K timebomb

Millions of German bank cards hit by Y2K timebomb

06 January 2010  |  16823 views  |  2 comments
Y2K-like bug knocks out BoQ Eftpos system

Y2K-like bug knocks out BoQ Eftpos system

04 January 2010  |  16225 views  |  0 comments

Related company news

 

Related blogs

Create a blog about this story (membership required)
Visit http://info.nice.comvisit www.swift.com/your-needs/instant-paymentsVisit https://www.capgemini.com

Top topics

Most viewed Most shared
Ripple makes new connections to emerging marketsRipple makes new connections to emerging m...
11585 views comments | 16 tweets | 10 linkedin
hands typing furiouslySome Interesting Applications Of The Inter...
10265 views 3 | 9 tweets | 1 linkedin
Basel Committee outlines disruptive fintech scenariosBasel Committee outlines disruptive fintec...
8375 views comments | 15 tweets | 26 linkedin
Investment Association sets up fintech accelerator for asset managersInvestment Association sets up fintech acc...
7932 views comments | 19 tweets | 10 linkedin
R3 creates Legal Centre of Excellence for blockchain technolgyR3 creates Legal Centre of Excellence for...
7649 views comments | 10 tweets | 14 linkedin

Featured job

Competitive
London, UK (or flexible)

Find your next job