Bó replacing up to 30,000 customer cards after Strong Customer Authentication oversight

UPDATE 06-02-2020 - An RBS spokesperson told AltFi that 6,000 cards were issued before 3 January and have to be replaced, the article has been updated to reflect that figure.

Digital “flanker” bank Bó is having to replace all of its customers’ cards issued before Christmas due to an oversight in their authentication software.

Bó told its customers last weekend that it would be sending out new cards for everyone who had opened an account before 3 January 2020.

In a blog post, Bó’s editor-in-chief Clair Whitefield explained: “We're introducing these cards because they will make it easier for us to make sure that the person using your card is actually you.”

Whitefield goes on to detail that the new cards would enable “stronger identity checks” required by the EU's Second Payment Services Directive (PSD2) and Strong Customer Authentication.

“If you opened an account after January 3rd, you will automatically have been sent a card that is compliant with the new legislation.”

Cards issued before that date and still in use will be deactivated on 14 March.

Bó launched to the public in November 2019. Sensor Tower, the app store market intelligence group, told AltFi that it estimates Bó downloads to-date across the App Store and Google Play at more than 31,000 while App Annie, the mobile data and analytics group, told AltFi it estimates Bó's downloads to be over 30,000.

An RBS spokesperson told AltFi that 6,000 Bó cards were in circulation before 3 January, and these will all now need to be replaced.

The bank is an offshoot of high street giant The Royal Bank of Scotland which has launched two digital challenger brands, Bó along with business-focused bank Mettle, over the last 12 months.

An RBS Spokesperson told AltFi: “In order to comply with new legislation designed to protect customers from fraud and increase security around all forms of payment, Bó will be re-issuing cards to all customers who received their Bó card before January 3 2020. The new Bó cards will message the customer via the payment terminal when they need to make a Chip & PIN transaction. We’ve chosen this option because we believe it provides a better customer experience.”

This week’s news of card replacements comes during a challenging time for Bó as its CEO Mark Bailie is expected to depart in the coming weeks, as part of a leadership shakeup by new RBS CEO Alison Rose.