What is credit card Fraud????
When someone uses your credit account or credit card to make a transaction you didn’t authorize that’s call Credit card fraud.
This could happen in alternative ways :
- if your credit card is stolen and then it can be used to make transactions via an online transaction or someone else/person.
- the fraudster can also steal your credit card PIN, credit card number, and a security code to make a transaction that is unauthorized, without using your credit card physically.
Types of credit card fraud / various techniques used by fraudsters to steal your card information.
There are various techniques fraudsters used to steal your credit card information :
- Card trapping
- This is a barb ( like a fishhook ) that carries on the card when you insert it in the machine and the card is retrieved later.
- Shoulder surfing
- If you find friendly bystanders in the room or outside of ATM station or if your credit card stuck in the machine or stand by your shoulder who try to help you, beware of them because they stand beside you to get your PIN
- Written PIN
- if you write your PIN on credit card easiness for you and forgot the card then it’s an open invitation to be scammed.
- In this technique, fraudsters attaching a data skimming device in the card reader slot to copy information from the magnetic strip when one swipes the card
- also, They set up cameras near the ATM machines to get your PIN number.
- when you doing online shopping or online transaction, at that time fraudsters reroute you on fake websites that actually looks similar to the original websites, and even if you conduct your transaction and can make a transaction using credit/debit cards then your details will be stolen
- By clicking some link and not on purpose you download ant software, which is a big opportunity for a fraudster to trace your activity and get you sensitive information
- point-of-sale or Merchant theft
- In this technique, your card is taken by your salesperson for swiping and copied your data available on a magnetic strip and it is used later for unauthorized transactions.
- Phishing & vishing
- In phishing, you get spam emails that seem like from original sources.
- while in vishing you get a message or SMS on your mobile phones
- this technique used for revealing your PIN, Password, and account information.
- SIM swipe
- in this, the fraudster contacts your mobile operator with fake identity proof and gets a duplicate SIM card. The operator deactivates your original SIM and the fraudster generates a one-time password (OTP) on the phone to make online transactions.
- Public Wi-Fi:
- when you are done with your transaction using public wifi on your phones or laptops then it makes a good opportunity for fraudsters to get trace your transaction and steal your details.
- This is malicious software that allows fraudsters to access confidential data, this software can damage computer systems at ATMs or bank servers.
- Lost or stolen cards
- This is the oldest technique, int this transaction made by stolen cards, they stop mails from the issuer to the owner or through phishing your mails and get PINS and password
How to prevent fraud accrues through credit cards??
- Keep Your Credit Cards Safe
- The simplest way to avoid credit card fraud id keeps your cards safe from the thief, put them in your wallet and purse which is closest to your body where it can’t easily snatch them.
- you are going to the market for shopping where heavy traffic is normally generated, then put your card in a smaller purse which is mostly harder to steal, and take your card at that place when necessary.
- When your payment is done then put your card back immediately because a fraudster can take images of your cards with a camera or mobile phone.
- Always make a strong password and keep them safe
- your credit card number store at many places for online transactions, just to make one-click for transactions/purchases. Make strong passwords with a combination of upper- and lower-case characters, numbers, and even characters, extra symbols.
- Check ATM station
- some times skimming devices are attached to the machine, this device capture your credit card information, and the fraudster come back to get this device and use that information to do the unauthorized transaction.
- check before Sign Blank Credit Card Receipts
- Always remember don’t sign a blank credit card receipt, and if you sign a blank credit card receipt then fill in zero amount.
- if you sign with a blank amount then the cashier can write the amount and send the purchase to your credit card issuer.
- Keep eyes on your monthly statement
- when you find unauthorized transactions that are not done by you, that’s no matter how small transactions just report your credit card issuer immediately. issuer inform what steps are done to avoid fraud
- and close your account and get a new account.
- safely throw your credit statement
- Don’t toss your credit card statement directly into the trash, because that your complete details are available. The same thing remembers when your old credit card expired or canceled.
- Keep safe your data where you stored
- Don’t store your credit card number, password, PIN, or other data on a smartphone. It’s too easy for card fraudsters to dig the data out and use it to commit fraud.
How to overcome if you are a victim of credit card fraud???
- Inform your bank immediately
- The RBI has advised banks to inform their customers to compulsory register for SMS ALERTS
- As soon as possible inform your bank about the unauthorized transaction within 3 days your liability is Zero. so the bank will credit that amounts within 10 working days from the date of informing them
- Zero-liability policies
- That’s mean you won’t be responsible for any fraudulent charges on your accounts.
- Change your passwords and PINs
- Immediately change your password and the PIN associated with your credit card account to prevent further damage to the fraudsters.
- monitor your account activity
- Keep an eye on your bank statements and if you see any signs of fraud, notify your credit card issuer immediately.
- inform cybercrime
- when that kind of fraud transaction occurs report this to your nearest police station or just call on 100 to Cyber Crime within 24 hr.
- If you report within 24 hours, your chances of getting your money back are very high
- Reporting merchant
- If you contact Merchants within 24 hr then they can stop fraud transactions.
- Merchants can help them by implementing a robust fraud protection solution. The combination of machine-learning technology with a manual review is the best consumer protection against fraud.
- Raised dispute with your respective bank
- Immidetaly contact with your bank and raised dispute for your fraud transaction.
- After raised dispute bank takes an action as are below:
- Block your card and re-issue a new card
- Bank investigate for your transaction. Usually investigation period is 45 to 90 days.
- After the bank of the concerned merchant is accepted to revert to the bank within 45 days, if the merchant contests your claim and provides supporting documents for the transaction.
- In this process, the credit card issuer will give you a refund during the investigation period, so that you don’t need to pay that amount for time being.
- If the investigation ends in your favor there won’t be any charge, but if it favors the merchant then the disputed amount would be charged to your bill.
RBI Guidelines for Banks – How to Protect Consumers Against Unauthorized Transactions?
The Reserve Bank of India has come up with a two-pronged approach to dealing with such scams.
- Part One: Includes counseling and awareness campaigns. Here banks have to constantly advise their customers on how to protect themselves from electronic banking and payment fraud.
- Part two: Includes the establishment of procedures and mechanisms by banks to prevent and detect fraudulent systems and procedures.
Debit card fraud vs credit card fraud
The difference between debit card fraud and credit card fraud
- Debit card fraud :
- cash directly come out from the bank account
- you need to compulsory report your bank within 2 to 5 days grace period if your debit card fraud occurs, the bank may not provide your money if you are late to inform.
- contact your debit card provider if you are a victim of this fraud
- Credit card fraud:
- fraudulent charges are included in your credit card bank statement,
- but there is no money deducted from your account although you will have to pay your bills at the end of the month
- The credit card provider company will refund your lost money in a fraud scenario.
- In credit card fraud, the card provider takes steps to recover any financial losses.
- In debit card fraud, the debit cardholder may be largely responsible for getting your cashback.
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