So Should You Really Change Your Chinese Bank Card?
UPDATE (May 4, 2017 at 1.40pm): UnionPay has released an official statement on the issue:
"Complying with the trend of chip migration in the payment industry, fallback transactions with UnionPay chip and magnetic stripe composite cards will be declined from 1st May, 2017 in mainland China. To align with the arrangement, UnionPay card fallback transactions will also be declined at ATMs and merchants in Hong Kong and Macau, China from 1st May, 2017. All transactions with UnionPay composite cards will be transacted solely with chips in Hong Kong and Macau, China. Given the UnionPay chip migration on both ATM and POS in Hong Kong and Macau has been completed now, cardholders’ experiences remain unchanged. Meanwhile, UnionPay magnetic-stripe cards can be accepted in Hong Kong and Macau as usual.
"In case of UnionPay chip card transaction failure, please... check if the card has been inserted correctly [and] ontact the issuing bank for card replacement due to possible chip damage."
Last month, reports circulated online that the magnetic stripe on many Chinese bank cards would no longer work after May 1, 2017.
The
news sparked a lot of confusion, with some banks confirming that the
changes would indeed be happening while others dismissed it as just a
rumor, according to local media reports.
But do you actually need to switch your bank card?
Answer: You don't necessarily need to, but you probably should.
As reported in various Chinese-language state media outlets (including Xinhua, Beijing News, People's Daily, China Daily,
CCTV and many, many more), the swiping feature on "hybrid cards" —
those with both a magnetic stripe and chip — was to be disabled starting
from May 1, 2017, following a notice issued by the People's Bank of
China, the country's central bank, in 2016.
The move, part of a
number of new rules also issued on May 1 (including one which requires
online gamers to register for accounts using their real identities), was
said to be part of a larger initiative to increase bank card security
nationwide. Magnetic stripes are supposedly more suspectible to forgery,
particularly on the hybrid cards.
The
chip will continue to work normally on these hybrid cards, and "pure
magnetic stripe cards" are said to be completely unaffected by the
changes. An employee at a major Chinese bank also confirmed this
information with That's.
For more information on all the types of cards issued by Chinese banks, click here.
When the That's
team tested out the swiping feature on hybrid cards in Beijing, Shanghai and Guangzhou after the May 1 deadline, however, the results
were extremely mixed across issuing banks and shops.
Some stripes
on hybrid cards were unable to be used by POS machines, while others
continued to operate normally. In certain cases, the same card produced
different results depending on the venue we visited. And in other
instances, a card from one bank worked just fine while another bank's
card failed to process at the exact same store.
ATMs, which
usually require inserting the entire card (rather than swiping), were
generally able to read the cards during our tests.
When That's editors tested the swipe function on hybrid cards after the May 1 deadline, it turned up mixed results
UnionPay, meanwhile, has reportedly deactivated the feature in Hong Kong and Macau, and That's has received word that the stripes on some hybrid cards no longer work overseas.
The
general consensus among Chinese-language news reports seems to be that
while it's not required to change your card, you should probably
consider making the switch as the country's banking system gradually
moves towards upgrading to chips.
According to the Beijing News,
the People's Bank first began promoting the switch to chip cards in
2013. And since 2014, more ATM and POS machines have begun closing down
the swiping function for hybrid cards.
Meanwhile, Sina reports
that there is no timetable in place to completely phase out magnetic
stripe cards, and as many as 3.3 billion were believed to be in
circulation at the end of 2016.
As always, we'd recommend
contacting your bank before deciding whether or not switch your card,
since the rules and notices seem to differ between banks.
To see a full list of bank hotlines, card processing fees and more click "Read more" at the bottom of the page.
To see a full list of bank hotlines, card processing fees and more click "Read more" below.