##man, prominently displayed, easily readable and, most importantly, the crucial items highlighted. the card issuing banks may continue to send the document containing the normal terms and conditions as is being done now. it is widely recognised that traditional credit cards are most prone to frauds – the problem with the black magnetic stripe on the back of a credit card is that it ’ s about as secure as bis central bankers ’ speeches writing account information on a postcard : everything is in the clear and can be copied. card fraud and the measures taken to prevent it, cost merchants, banks and consumers billions each year across the globe. in contrast, smart chip cards can ’ t be copied, which greatly reduces the potential for fraud. smart cards with built - in chips are the equivalent of a safe – the information contained therein can only be unlocked with the right key, which means that the cards can not be replicated. one of our banks introduced the smart cards a few years back. let me take this opportunity to encourage other banks to follow suit. this will entail in some cases complete upgrading of atm terminals to support chip - based atm cards, but the long - run benefits of such an upgrade will accrue to all stakeholders. we believe that a smoothly operating infrastructure can greatly enhance financial security. this concept includes the payment system, the technological infrastructure, as well as the regulatory and supervisory framework. an important function of the central bank is to oversee the payments system as inability to make payments in an economy would have a far reaching and widespread bearing on society. technological infrastructure is perhaps the most important component to secure financial operations. financial systems continuously need to adapt themselves to the rapidly increasing technological innovations. this includes new products, necessitating increased awareness by the users and supervisors of the risks and benefits inherent in them. on this front, the bank of mauritius took proactive steps way before the financial crisis in 2007 to re - structure the payment systems and market infrastructures area and to endow the country with a modern and innovative payment system. the world is rapidly moving towards a real time economy where all types of transactions are digital, automatically generated and completed in real time. payment systems, being one of the most inter - related sectors of the modern economy, the call for innovation sounded, even more urgent for all its operators. the new software for the mauritius automated clearing and settlement system ( macss ) was the step in this direction with which, we have been able to provide extended services in multi currency

solutions and increasingly complex security layers. another trend that we have observed of late is the outsourcing of credit and other payment card services to specialist third parties. this is mainly done to benefit from the expertise of the third party which may not be available in - house and / or as cost - cutting measure. however, there is very often over - reliance and inadequate diligence on the service providers. our licensees are required to strictly follow the risk management principles enunciated in the guideline on outsourcing for financial institutions issued by the bank of mauritius and address the risks inherent in outsourcing. outsourcing of those activities would have to be approved by the board of directors of the financial institution in the first instance and subsequently by the bank of mauritius. in addition, the outsourcing of such services is contingent upon the third party service providers agreeing that their services are subject to regulation and examination by the bank of mauritius to the same extent as if such services were being performed in - house. so much for the role of the bank of mauritius in ensuring that banks and other financial institutions have systems in place that deter card - related fraud. but the fight against fraud calls for the active involvement of other stakeholders. customers, on their part, have to act in a responsible manner. simple things like following the recommended fraud prevention advice – which is quick and simple to follow – can considerably reduce the chances of falling prey to fraudsters. it is however essential that card issuing banks and card associations regularly run awareness campaigns for the benefit of consumers. an ancillary issue relates to customer grievances in respect of credit cards. in this context, i make an appeal to banks for greater transparency and disclosure, since there is often an asymmetry of information, both written and oral, between the card - issuing bank who has complete information and the card holders who very often do not have complete information on their rights. in particular, we have observed that card issuing banks provide enormous information to their customers but the language used is legal terminology which is not easily understandable to ordinary customers. in addition, the written information is often printed in very small print which hinders easy readability, and important information is buried with other information. there are no standards in this regard among the card issuing banks. i take this opportunity to encourage card issuing banks to adopt a more customer - friendly approach with clear terms and conditions for card issue and usage, in simple language comprehensible to a lay