New
innovations have been on the anvil to secure financial transactions and combat
credit card fraud. These range from holographic identification symptoms to
tamper-proof signature panel codes for card validation and EMV chips. These
security advances notwithstanding, credit card fraud remains more of a threat
than ever before. Consumer education on how to safeguard cardholder information
could help. Banks and merchant businesses can also prevent credit card fraud by
exercising caution. The first step in protecting yourself is to understand the
various kinds of fraud associated with credit card transactions.
Types of Credit Card Fraud
The most
common type of credit card fraud is a lost or stolen card. These must be
reported to prevent damages. Another credit card fraud is account takeover,
when cardholders unfortunately part with personal details such as home address,
date of birth and mother's maiden name to a scammer. The fraudster then
contacts the bank of the cardholder, reports the lost card and address change
and obtains a fresh card in the victim's name.
Another credit card fraud is counterfeit cards. Here, the card is cloned from another
and used for the purpose of buy goods and services. Malpractices such as credit
card skimming are widely prevalent in many countries. But this has been
declining in recent times due to the use of an EMV chip.
A fourth
type of credit card fraud is the “never received” scam where the fresh or
replacement card is stolen from the mail and does not reach its correct owner.
Another type of credit card fraud is when the scammer uses contact details and
information of the victim to apply and obtain a card– this is called fraudulent
application. A credit card fraud called “multiple imprint” involves a single
transaction being recorded many times on imprint machines/ knuckle busters.
Collusive merchants may also work with fraudsters to defraud banks.
Mail
order/telephone order fraud also includes eCommerce now. It is the largest
category of total payment card fraud, adding up to ¾ of all the fraud
incidences. Card verification and security programs are being put forth to
prevent fraud in the “card not present” transactions online or via
mail/telephone transactions.
What You Can Do to Avert Credit Card Fraud
Measures such
as Zero Liability policy also protect clients from transactions which are not
authorized in terms of both digital and electronic payments. This also ensures
fraud can easily be prevented.
Staying
alert about protecting personal information can greatly reduce chances of theft
or fraud. This is an important step in a digital world where mobile banking and
smartphone revolution has necessitated changes. Credit cards have build in
protection and the first line of defense commences with the cardholder.
Whether it
is protecting your card from unauthorized transactions or ensuring that credit
card details are kept safely lies in your hands. According to Big scammers
fraud prevention tips, the different kinds of credit card fraud necessitate
precautions to ensure that there are no issues. A cardholder has to exercise
all levels of caution to ensure that cards are kept safe and transactions are
carried out with heightened security.
