Financial Information System Coursework Example | Topics and Well Written Essays - 3750 words

Financial Information System - Coursework Example The enhanced security and reduction of chances of fraud have started making the consumers accept it as the new means of transactions. The traditional swipe and signature is still in use for some period of time so as to make the changeover smooth and in the meantime the users can get used to the Chip and PIN system. Not just the consumers, the replacement of machines for the new system will also take some time and the nationwide and regional changeover can not be done in an instance. The parallel run of both the systems is planned to make the users aware of the Chip and PIN system before completely switching to the new system of payments. The costs incurred in the implementation of the new system are incurred at various levels both within and outside the organization. The overall costs of changeover to the new system includes the costs of replacing the old card machines (designed for swipe and signature system) with the new Chip and PIN compatible machines at Point of Sale (POS) Terminals as well as cash machines, upgrading the backend system to handle the Chip and PIN system, securing the card centers to handle for the payments and training the staff for the new implementation and operations. The cost of issuance of new cards to the existing card holders also adds a good percentage to overall costs. The potential benefits the system is expected to offer are way mor... The overall costs of changeover to the new system includes the costs of replacing the old card machines (designed for swipe and signature system) with the new Chip and PIN compatible machines at Point of Sale (POS) Terminals as well as cash machines, upgrading the backend system to handle the Chip and PIN system, securing the card centers to handle for the payments and training the staff for the new implementation and operations. The cost of issuance of new cards to the existing card holders also adds a good percentage to overall costs. The potential benefits the system is expected to offer are way more than the costs incurred. The enhanced level of security in the new system will build confidence among the card users. The security and reliability of the system will make it cheat proof and difficult to hack. The users will feel more secure transacting using their Chip and PIN cards than the traditional swipe and signature ones. The implementation in 2005 reduced the rate of fraud by 13% saving 65 million to the banks. In normal credit or debit cards, the signature of holder is present on the back of the card, whereas for the new ones, PIN will not be present anywhere on the card. This will make it more secure. Even if the card is lost, the chances of someone using it are rare. The card-locking feature on three unsuccessful attempts makes it more secure than a traditional card where the cardholder is only required to do signature on the receipt. The signatures are, most of the times, not even checked for correctness at the point of sale. The use of biometrics may provide a system even more secure than the Chip and PIN environment, but the costs of