Wed, Oct 08, 2003 - Page 10 News List

Big payouts create headaches for some cash-card programs

By Joyce Huang  /  STAFF REPORTER

Two recent bank cash-advance card errors have rattled local banks who fear the incidents may scare away some card users.

Earlier this month, the automated-teller machines (ATMs) of First Commercial Bank (第一銀行) and Asia Pacific Bank (泛亞銀行) mistakenly coughed up NT$33 million and NT$2.56 million, respectively, to two of the banks' cash-advance cardholders.

"In line with a warning from the Ministry of Finance, we have temporarily suspended the issuance of new cash-advance cards until our self-designed ATM cash-advance programs are debugged," said a First Commercial bank official surnamed Hung yesterday.

She said that a review report will soon be issued to improve the bank's standards for remitting cash-advance payments in order to prevent such mistakes from occurring again.

The ministry has asked Asia Pacific to temporarily suspend its cash-advance services while urging cash-advance card issuers nationwide to review their cash-advance systems.

Both banks have filed lawsuits against the two cardholders who received the unexpected bonuses.

The incidents seemed to have scared away some card users.

"Some cardholders are a little hesitant about using the cards now after learning that programming mistakes may get them into legal trouble," said Lin Mei-lan (林梅蘭), supervisor of consumer banking at the Union Bank of Taiwan (聯邦銀行).

But Lin said she has confidence in cash-advance card business and the bank hopes to recruit 330,000 more cardholders by year's end. She said the bank's cardholders borrowed a total of NT$5.5 billion in the past year.

Lin said that it was unlikely her bank's system would make a big mistake since it has a ceiling of NT$300,000 per cardholder.

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