I READ last Saturday's article, "New ez-link cards let you do more". The article surprised me and I would like to share my knowledge as a professional in the financial payment industry.
Ez-link cards were designed for mass transport, such as the MRT which requires speedy payment to ensure smooth commuter flow in and out of stations. If an ez-link card is lost or stolen and the stored value is used by the new user, the owner is not compensated, as when cash is lost.
The strength of the system is speed, but as no PIN is required to verify the card owner, the trade-off is vulnerability to theft. The system works well for specific use in a contained environment such as mass transport as the card can be used only to pay for transport and the attraction to thieves is hence low.
There have been instances when CashCards in in-vehicle units were stolen by smashing car windows. CashCards are attractive because they similarly do not require PIN verification, but can also be used in retail outlets where Nets cards are accepted.
Not only will the problem of CashCards now apply to ez-link cards when they are used for ERP payment, but a new fraud named "electronic pick-pocket" could arise when the contactless purse is accepted at retail outlets.
What could happen is an unethical merchant who accepts ez-link payment could now also "pick" value out of an ez-link card with a point-of-sale device. Such theft may go unnoticed if the amount is small.
I suggest ez-link cards not be used for retail payment. To speed up retail payment, have a contactless Nets debit card (with PIN) instead.
Koh Jin Kit
This article was first published in The Straits Times on Jan 2, 2009..
