BANKS have decided to change a long-standing policy which made credit card holders liable for all charges incurred on lost or stolen cards before they are reported missing.

From Nov 1, cardholders' liability will be capped at $100, provided they are not negligent or fraudulent and notify the banks as soon as they discover the loss.

In some cases, the banks may even waive the amount, according to an Association of Banks in Singapore (ABS) internal briefing note to banks obtained by The Straits Times.

Contacted on Thursday, a spokesman for the association declined comment, but a check with some banks confirmed the change. No reasons were given for what amounts to a change of heart among banks here.

ABS also issued a statement saying that 'the first and primary line of defence is the customer, who has custody and possession of the card'.

Currently, only two card issuers, Maybank and American Express, have liability caps. The Amex limit is $100, while Maybank's is $500.

Other banks hold cardholders responsible for all transactions made before a loss of card is reported. But some, like DBS Bank and Citibank, said they would review cases individually.

According to the ABS memo, the changes are aimed at providing 'transparency and to give cardholders more certainty about their credit card liability'.

Consumers Association of Singapore president Yeo Guat Kwang applauded the news and said: 'This protection for consumers is long overdue.'

Plastic has become increasingly popular in Singapore. According to the Monetary Authority of Singapore's statistics, Singapore consumers held 6.28 million credit cards and used them to pay for upwards of $25.66 billion in goods and services last year.

From January to July this year, some 6.53 million credit cards had been used to ring up $14.11 billion in charges.

chuahh@sph.com.sg

weichean@sph.com.sg