Gemalto, a smart card supplier, will book an exceptional charge of up to EUR10 million in its 2009 results. The charge comes to cover financial claims stemming from a Y2K-related coding error that rendered millions of German payment cards unable to process the 2010 date-change.

As a result of the glitch as many as 30 million payment card users were unable to use their cards in cash machines and eftpos terminals across the country. German customers traveling overseas were also hit.

Gemalto says it has provided a "secure procedure to its customers in Germany to address the situation". The unspecified remedial measure was approved by the German banking authorities on 7 January.

The company feared that it would be forced to replace the affected cards, a move experts estimated could cost up to EUR300 million.

Olivier Piou, Gemalto CEO says: "This is a regrettable incident, and we are doing everything in our power to support our banking customers in resuming full normal operations. We worked with them hand-in-hand to create a strong secure software solution that enables our customers to resolve the problem of the concerned cards without reissuing these cards."

Piou says Gemalto will take a special provision of EUR6-10 million to cover the "potential consequences related to this event". The charge will be booked as part of the vendor's 2009 results, reducing expectations of around EUR180 million adjusted Ebit for the year by the same amount.