Manage Money

Avoid Credit Card Fraud

A breach of trust is always hard to deal with. Fraud is never something that you ever want to happen to yourself, although you hear time and again that it keeps happening to other people. Rather than live in denial, it is always better to keep your eyes open and take the necessary precautions.

Let’s see how we can keep away from one of the prevalent modes of monetary swindling - credit card fraud.

What Is Credit Card Fraud?

Credit card fraud happens when an individual’s credit card access details fall into the hands of a criminal organisation or person who uses unjust means to acquire money. This can happen either through carelessness from the credit card holder’s side or when the fraudster manages to get the information making malicious use of technology.

Once through, the criminal uses the victim's credit card for large purchases or fund transfers. This can cause significant mental and financial distress to the card holder, putting them in a really tough situation.

A Huge Step Against Credit Card Fraud

With the advent of the EMV chip technology, the world had breathed a sigh of relief, as the new development has promised to shift the liability for counterfeit and fraudulent transactions from the card-holder or the issuer to the merchant, provided that the card has an EMV chip but the merchant does not support EMV chip transactions.

In case you're wondering what an EMV chip is, take out your newest credit or debit card from your wallet and look for a small embedded golden square. That's an EMV chip. The technology is superior to the older magnetic strip, and it is more difficult to hack into your account information through chip transactions than the ones through the magnetic strips.

How to Protect Yourself From Credit Card Frauds?

If your debit card is hacked, your bank account balance might take a huge hit. On the other hand, a credit card fraud would be of much less consequence for you as technically you haven't lost any money. If you report credit card fraud on time, you need not bear any liability. 

First, you must have an idea of your liabilities for fraudulent credit card charges. As per RBI's guidelines in 2017, if the bank is in any way responsible for the fraud, you have zero liability. If your own negligence resulted in the fraud, you would have to bear the entire loss until you report the unauthorized transaction to the bank. The bank shall bear any illegal transaction that occurs after you have reported the issue. However, if you don't report the fraud within seven days, the bank's policies will decide the customer’s liability.

How to Prevent Credit Card Fraud

EMV technology has helped prevent fraud considerably. However, fraudsters are keen on keeping up, and they continuously come up with new ways of swindling unwitting commoners. The best we can do is be alert and secure our accounts. Here are a few interesting ways that can help you make your accounts a little more secure.

Making Online Purchases

It's always safer and more preferable to use a credit card for online purchases than a debit card.

Keeping All Information Safe

Do you ever save your credit card details on various online shopping platforms? Well, it might be very convenient, but it isn't a great idea. It's unsafe. Online retail accounts aren't well secured. If someone hacks into your online retail account, he/she can easily access your credit card information. Therefore, make sure that you keep your credit card information secure.

Another important aspect is your Card Verification Value (CVV). CVV helps to limit fraud. Most online merchants would ask you to enter your CVV to make a payment. If a merchant is able to process a payment without the CVV, purchasing from that merchant site isn't a wise decision.

Phone as a Mobile Wallet

With the advent of technologies like e-wallets and UPI, you must probably be using your phone as a mobile wallet. Most of your bank account and credit card information is sure to be saved in several apps on your phone. The question is - are you sure that it is safe? Have you been using all the security features that your phone contains?

Most phones these days come with several security features. There are fingerprint locks, PIN codes, passwords, gesture locks, etc. If your phone doesn't have one, you can download a mobile security app to do the work. Try to add an extra layer of security to the apps that you use for banking and shopping.

Some card-issuing companies provide the facility to set alerts via text messages or email whenever your card is used. You could opt for such facilities to stay alert and identify fraud immediately.

Using Public Networks

Most airports, shopping malls, restaurants and coffee shops make life easier for us by providing us with free wifi. Isn't it super convenient? Yes, of course! Is it super safe? Definitely not!

While texting and browsing on public networks are safe, shopping and banking aren't. The server may record your data, and counterfeiting gets easier through this. Use your own data connection for safe and secure transactions. In case of dire need, consider using a VPN (Virtual Private Network). It will keep your information safe from thieves and fraudsters.

You must also shop only at secure sites. There are many hoax sites which collect your account information for criminals. Carefully check before you trust a website.

Setting up Alerts

Some card-issuing companies provide the facility to set alerts via text messages or email whenever your card is used. You could opt for such facilities to stay alert and identify fraud or identity theft immediately.

To Sum Up

There isn't always a way of making your accounts absolutely fraud-proof, but following these steps can help you keep them secure. They are like layers of security that you can add to prevent a potential case of fraud. Keep a check on your credit score to be able to identify possible fraud.

You can use mymoneykarma’s credit score tracker for this purpose. Stay safe!


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