The new card, which was launched on Tuesday, comes with Secure Quick Response (SQR) code that enables identity verification through Android or iPhone devices.
All newly registered refugees will receive the upgraded card from the United Nations High Commissioner for Refugees (UNHCR) starting from Tuesday, while existing registered refugees will be given it when they renew their current cards.
The upgraded card is also equipped with biometric data, 3D holograms and bar codes to prevent forgery.
Malaysian media have highlighted sellings of fake UNHCR cards after several high ranking officers and ministers voiced concerns about criminals who were using falsified cards.
The issue was raised by the Malaysian government after several murder cases involving clashes between Muslim and Buddhist from Burma were reported in Malaysia in 2014 and 2015.
Burmese nationals in Malaysia linked the murder cases with ethnic conflict in Arakan State in Burma but Malaysian police had denied any linkages.
The issue of 'genuine refugee' was raised again last year after several boats carrying both Rohingya and Bangladeshi migrants landed on Malaysia's shores.
According to UNHCR Malaysia, out of 139,780 refugees from Burma, 53,410 are Rohingyas, 43,660 Chins and 11,530 Burma Muslim. - Reporting by Thomas Chong#