Prevention of Frauds and Misuse, Consumer Protection. Indian Scenario

Debit card fraud occurs when a criminal gains access to your debit card number and in some cases, personal identification number (PIN) to make unauthorized purchases or withdraw cash from your account. There are many different methods of obtaining your information, from unscrupulous employees to hackers gaining access to your data from a retailer’s insecure computer or network. Fortunately, it doesn’t take any special skills to detect debit card fraud.

When your debit card is used fraudulently, the money goes missing from your account instantly. Payments you’ve scheduled or checks you’ve mailed may bounce, and you may not be able to afford necessities. It can take a while for the fraud to be cleared up and the money restored to your account.

Credit card fraud is an inclusive term for fraud committed using a payment card, such as a credit card or debit card. The purpose may be to obtain goods or services or to make payment to another account, which is controlled by a criminal. The Payment Card Industry Data Security Standard (PCI DSS) is the data security standard created to help financial institutions process card payments securely and reduce card fraud.

Credit card fraud can be authorised, where the genuine customer themselves processes a payment to another account which is controlled by a criminal, or unauthorised, where the account holder does not provide authorisation for the payment to proceed and the transaction is carried out by a third party. In 2018, unauthorised financial fraud losses across payment cards and remote banking totalled £844.8 million in the United Kingdom. Whereas banks and card companies prevented £1.66 billion in unauthorised fraud in 2018. That is the equivalent to £2 in every £3 of attempted fraud being stopped.

Credit cards are more secure than ever, with regulators, card providers and banks taking considerable time and effort to collaborate with investigators worldwide to ensure fraudsters aren’t successful. Cardholders’ money is usually protected from scammers with regulations that make the card provider and bank accountable. The technology and security measures behind credit cards are becoming increasingly sophisticated making it harder for fraudsters to steal money.

Protection

Go Paperless

Signing up for paperless bank statements will eliminate the possibility of having bank account information stolen from your mailbox. Shredding existing bank statements and debit card receipts using a paper shredder when you’re done with them will significantly reduce the possibility of having bank account information stolen from your trash.

Get Banking Alerts

In addition to checking your balance and recent transactions online daily, you can sign up for banking alerts. Your bank will then contact you by email or text message when certain activity occurs on your accounts, such as a withdrawal exceeding an amount you specify or a change of address.

Don’t Make Purchases with Your Debit Card

Use a credit card, which offers greater protection against fraud, rather than a debit card.

Destroy Old Debit Cards

Some shredders will take care of this for you; otherwise, your old card floating around puts your information at risk.

Don’t Keep All Your Money in One Place

If your checking account is compromised, you want to be able to access cash from another source to pay for necessities and meet your financial obligations.

Stick to Bank ATMs

Bank ATMs tend to have better security (video cameras) than automated teller machines at convenience stores, restaurants, and other places.

Beware of Phishing Scams

When checking your email or doing business online, make sure you know who you’re interacting with. An identity thief may set up a phishing web site that looks like it belongs to your bank or another business you have an account with. In reality, the scammer is looking to get access to your personal information and may attempt to access your bank account.

Use a Secured Network

Don’t do financial transactions online, when using your mobile devices or computer in a public place or over an unsecured network.

Protect Your Computer and Mobile Devices

Use firewall, anti-virus, and anti-spyware software on your computer and mobile devices, while keeping it updated regularly.

Card information is stored in a number of formats. Card numbers formally the Primary Account Number (PAN) are often embossed or imprinted on the card, and a magnetic stripe on the back contains the data in a machine-readable format. Fields can vary, but the most common include Name of the card holder; Card number; Expiration date; and Verification CVV code.

In Europe and Canada, most cards are equipped with an EMV chip which requires a 4-to-6-digit PIN to be entered into the merchant’s terminal before payment will be authorized. However, a PIN isn’t required for online transactions. In some European countries, if you don’t have a card with a chip, you may be asked for photo-ID at the point of sale.

In some countries, a credit card holder can make a contactless payment for goods or services by tapping their card against a RFID or NFC reader without the need for a PIN or signature if the cost falls under a pre-determined limit. However, a stolen credit or debit card could be used for a number of smaller transactions prior to the fraudulent activity being flagged.

Card issuers maintain several countermeasures, including software that can estimate the probability of fraud. For example, a large transaction occurring a great distance from the cardholder’s home might seem suspicious. The merchant may be instructed to call the card issuer for verification or to decline the transaction, or even to hold the card and refuse to return it to the customer.