The global semiconductor shortage could impact supply of debit and credit cards, disrupting digital payments systems worldwide, industry body Smart Payment Association (SPA) said in a statement.
(Subscribe to our Today's Cache newsletter for a quick snapshot of top 5 tech stories. Click here to subscribe for free.)
Payment cards have accelerated the use of online payments worldwide with up to 60% online transactions taking place directly or indirectly through these cards, according to the industry body. Nearly 90% of non-cash consumer payments are made using credit or debit cards.
Payment cards are issued upon opening a bank account, renewed regularly after their expiration date or replaced in an emergency when a card is lost or compromised. Over 3 billion EMV-standard based cards need to be produced and delivered to customers worldwide every year, the association noted.
Watch | Why the world is running short on computer chips
The widely reported bottlenecks in chip supply have become so critical that payment card manufacturers face increasing difficulties in obtaining chips needed to produce cards. "The industry body foresees significant disruptions in payment cards production beyond the reasonable control of payment card manufacturers that will affect their ability to meet full demand," it added.
The trade body also said it has initiated actions with payment schemes, central banks, and governments to obtain semiconductor foundries on high priority.
Several industries including electronics and automobiles have been adversely impacted by the shortage of computer chips . Research firm Gartner said last month the supply crunch is likely to last until the second quarter of 2022 and will cause an increase in prices of devices.
