Global Chip Shortage Can Affect Credit Card / Debit Cards, Industrial Body Warnings

Shortage of the earth chip now threatens to disrupt the online payment system. Explaining the importance of payment cards in everyday life and transactions, the Smart Payment Association has warned of major disruptions if this issue is not addressed.

It said every year more than 3 billion EMV-based payment cards are produced worldwide for people who open a bank account, or those who renew after expiration or exchange.

But card manufacturers are facing increasing difficulty finding chips because of problems in the supply chain.

The Credit Card and Mobile Payment Industry Association has urged government agencies and stakeholders to improve the supply chain to avoid major disruptions.

About 90 percent of non-cash consumer payments are made using real-time credit cards and are very important for cash receipts, he said, adding that 40-60 percent of online payments are directly or indirectly supported by payment cards.

Therefore, finding an uninterrupted purchase of payment cards is important in supporting commercial and everyday life.

The epidemic forced chip makers to shut down operations last year. By the time they reopened, they had a surplus to fill.

As they limped back, they were overwhelmed by the sudden demand for electronics around the world.

In recent months, the semiconductor industry has been hit by a severe shortage of products such as PCs, mobiles / tablets, sports consoles, but especially cars.

Manufacturers had to delay their production line as there was not enough availability of chips. And it seems that shortages are now increasing in some areas.

Citing the resilience shown by the payment card industry during the epidemic, the body said it served the banks in unprecedented circumstances, bringing the cards between closures wherever and whenever needed.

“Now, with the global chip shortage there has been another threat,” the trade association said.

The association said the difficulties in chip sales are still very important and card manufacturers are facing increasing difficulty in getting chips, and that this shortfall is likely to continue throughout the year 2022.

It warned that there may be major disruptions along the way that will affect the ability of card manufacturers to meet the full demand.

The organization added that it had already taken steps to ensure the availability of payment cards but urged governments to do more.

It said card manufacturers working with the association were making “every possible effort” to reduce the disruption of card delivery.

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