11 Ways to Prevent Credit Card Fraud
With the increasing use of credit cards, their vulnerability has been exposed as much as their benefits have come to light. Credit card scams are nothing new – they have been there since the very beginning. It is true that the fraudsters have always kept pace with the newer security measures, yet there are some old, simple ways to prevent frauds that still hold good. Here’s a look:
- Confidentiality. One of the basic tenets of security is to keep your information to yourself. Your credit card number or CVV (Card Verification Value) number is something that should be private to you. Avoid sharing this sensitive information the way you exchange your phone number with everyone. If you use your credit card online or through phone banking, you must be having the login credentials, like username, password or PIN. Often users keep such data written somewhere, such that it does not get lost. Keep all such collection safely at a place, which no one can access except you. By no means should you ask others to transact on your behalf online. For instance, if you are stuck without internet somewhere, it is better to call your bank and ask for alternatives or use its phone banking services.
- Reporting. Immediately report any lost cards or unauthorized transactions on your account to the issuing bank. There are fair chances that the bank manages to cancel the transaction before settlement, saving you hassles and dollars.
- Monitoring. Keep a log of all the sales receipts you sign and all the online transactions you make. Cross-check these items with the entries in your credit card statement. Report any unauthorized transaction to your bank. This becomes even more important if you keep making interim credit card payments before the due date. Make sure that you do not end up paying twice for the same item.
- Online Security. If you use your credit card online, you should be aware of certain basics. Every online merchant has a participating financial institution, which provides the platform for payment processing. As soon as you proceed to checkout on the seller’s site, you are redirected to the relevant payment gateway. Before submitting your card information, make sure that the gateway has a secured connection. The address bar of your browser should reflect ‘https://’ and not ‘http://’. Search for the ‘lock’ symbol on your browser – it could be located on the right or left of the address bar or somewhere on the lower bar of the browser. The ‘lock’ should appear ‘closed’ and should not be placed on the displayed page. This symbol indicates the use of SSL (Secure Sockets Layer) technology, which encrypts all your information before transmitting it over the internet to prevent any third-party from viewing it during the transit. When you click on the ‘lock’, a popup window opens, containing information about the SSL certificate of the payment gateway, including the site ownership, type of encryption and validity date. In addition, the security certificate issuers, such as VeriSign, also place their logo link on the page that direct to further certificate information. Inspecting all these elements can reasonably protect you from fake websites designed only with the purpose of capturing your data.
- Privacy. Avoid making online transactions on public computers – you never know what kind of data they are storing. Often, such public computers are under attack by virus or other malicious programs, some of which may be specifically designed to store data secretly. Even while using your PC, it is a good idea to allow cookies only for the session or use private browsing, a feature that most of the popular browsers offer these days. If you are in the private browsing mode, the computer will not save history or cookies on your computer and there will be no trace of the transactions done. If anyone else later logs in to your computer, they won’t be able to retrieve your information by using the auto complete function of the cookies.
Even the seemingly simple step of signing your card immediately on receipt can save the day for you.
- Ownership. The documentation that you receive with a new credit card contains the clause that you ‘must’ sign on the signature panel on the reverse of the card immediately upon receipt. A popular philosophy that gained grounds lately says that you should not sign and write ‘See ID’ or “Check ID’ instead. The proponents argue that in case of a theft, the card cannot be used by the thief because the merchants will ask for additional ID proofs in lieu of an unsigned card. However, there are several reasons why you should not resort to this practice. Firstly, a signed card establishes the ownership of the holder. Secondly, a credit card is an instrument of contract between the holder and the issuing bank. Therefore, if you do not sign your card, it is rendered invalid and illegal. Thirdly, the card issuers, like MasterCard and Visa, forbid the merchants from accepting unsigned cards. Lastly, but most importantly, your unsigned credit card becomes more vulnerable to frauds. If merchants encounter such a card, they may insist on an ID proof or that the holder signs on the card in front of them. Understandably, the thief will choose to sign on the card, as well as, the sales receipt.
- Vigilance. While standing at the billing counter, keep an eye on the handling of your card. Make sure that it is swiped in front of you and that no one is slyly trying to scan your information, including the card number, expiry date and the CVV number.
- Verification. Before signing the sales receipt of your card, crosscheck the amount charged with the bill amount. Remember, a single additional zero in the end can make a huge difference to your total. Similarly, while doing online transactions, do not be in a hurry to advance the ‘verification’ screen that appears with all the entered information just before the confirmation screen. Take your time verify all the data, including the amount to be charged and then hit the ‘confirm’ button.
- Information. All the banks provide alert services to the cardholders through sms, phone calls or emails. As soon as a transaction is done on your credit card, you get an alert. Some banks offer these services free of cost, while the others charge a nominal fee. Even if you have to pay a price here, it’s worth it.
- Prudence. Beware of phishing. Do not send your credit card number or other specifics over email. Never respond to any email or phone calls asking for your information. No legitimate bank asks for such data. Almost everyone knows that the card number, expiry date, and CVV numbers are sensitive numbers. However, not many people know that your personal information, like address, date of birth, etc. that your bank uses for your identification are equally sensitive. Imagine a fraudster catching hold of this information, using it to for identification and effecting transactions on your account!
- Additional Protection. Some card issuers provide an additional layer of security for online transactions, wherein you need to enter an additional password after submitting the credit card information. Incorrect password terminates the transaction before the confirmation stage. MasterCard SecureCode is a good example of this feature. This service is optional, but highly recommended. MasterCard suggests that is in your own interest to register your primary, as well as, the add-on cards for SecureCode.