The cost of EMV-compliant chips is putting a burden on financial institutions across the globe. In 2021 alone, the cost of this technology increased by more than 50% and its expected costs will continue to rise into 2023.
Why the increase in prices? Experts say there are several factors contributing to these price hikes, but it’s likely the biggest drivers stem from the global Covid-19 pandemic and the war in Ukraine. Throughout the pandemic several key cities in countries like China locked down, slowing the production of microchips and putting a strain on supply around the world. And, the war in Ukraine is making it difficult to secure neon gas and palladium, which are key materials used to develop microchips and are typically sourced from Russia and Ukraine.
The American Bankers Association published a letter in November 2021 on the topic, which stated that if supply shortages persist “some payment card issuers could potentially face challenges in consistently delivering the timely replacement of chip cards or issuing new chip cards”. Until the supply challenges stabilize, financial institutions are left to make tough choices and tradeoffs.
So, how can banks and other card issuers offset these higher supply costs? One recommendation would be to look at increasing the longevity of physical payment cards they offer new and existing clients. If cards are made more durable, then they don’t need to be replaced as often and the life of the card could be extended, saving on supply and operational costs.
Entrust has just begun offering its proven Durable Graphics technology used for high-volume card issuer clients to instant financial issuer clients. This technology has doubled the life of tens of millions of payment cards in circulation today and now can be used with the Sigma DS4 Instant Issuance system to bring more durability to instantly issued payment cards. However, this technology doesn’t just increase the life of the card, it also brings bolder branding and personalization opportunities that stands out in clarity and color.
To learn more about how Entrust and the all-new Sigma Light Curing Module can enable your financial institution to increase sturdiness and personalization for your instant issuance program, visit: https://www.entrust.com/issuance-systems/products/instant/financial-card/sigma-ds4-card-printer-with-light-curing-module.