With technological advancements coupled with smartphone and internet penetration, cyber-crimes, debit and credit card frauds are increasing not only in India but across the world. According to a study by a payments company, during the last five years India and USA are the countries with the third-highest card fraud behind China at 42%
With technological advancements coupled with smartphone and internet penetration, cyber-crimes, debit and credit card frauds are increasing not only in India but across the world. According to a study by a payments company, during the last five years India and USA are the countries with the third-highest card fraud behind China at 42% and the United Arab Emirates at 44%.
Let us see how such frauds happen and what protective measures one need to adopt.
One of the most common methods of card frauds is card cloning wherein the caller poses as a bank staff and urges customers to share their card details and PIN over the phone saying that the customer card has been upgraded or that the card will be cancelled in the next 45 minutes if information is not shared with them. Once the data isshared, a new card is made and cash withdrawn or funds transferred. Another technique is usage of skimmers. Fraudsters fit skimmers in ATM machines which scans all data of the card holders and makes clone cards. Often in hotels and malls, a clerk or waiter takes a photo of your card and uses your account to buy items or create another account.
Incorporating a few precautionary measures can help prevent any acts of card frauds.
Don’t disclose your PIN
Use cash on delivery option
Whenever you transact on e-commerce sites, try to go for cash on delivery option. Use your card only when the above option is not available and check whether the company is reputable. If you have not done any business with it before, do an online search for reviews and comments before using your card.
Most importantly whatever the e-commerce site says, never choose the option of save your card details.
Look at the ATM slot
Report lost card, frauds at once Most banks and credit card companies have toll-free 24×7 service to deal with reporting of lost card and fraud. Once you have raised a complaint about loss or theft, as per the law you have no additional responsibility for charges which you did not make.
Do not carry all your cards with you always. Take with you only the card that you need. Maintain a record in your computer or diary on the account numbers of your cards, their expiry dates and phone numbers so that you can easily report any incidence of fraud or loss. Avoid carrying in your wallet PIN number written on a piece of paper.
Do not lend your card to anyone and shred your receipts and card statements. Do not panic if you have lost your card or have found any fraudulent activities. Just report the matter immediately. Also, change your PIN and password frequently.
The writer is associate professor of finance & accounting, IIM Shillong
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