Having little or no credit card liability, fraud or identity theft can still cause problems for both the clients and the bank. The bank’s zero-liability policy prevents credit card users from paying
the price, providing customers to report the scam within 60 days and they have to endure the hassle of identifying the theft, notifying the bank, obtaining a replacement card, paying the cost, and resetting all the auto-pay accounts.
What is Credit Card fraud?
Credit Card fraud refers to when a scammer makes unauthorized purchases from your account using your credit card number, PIN, or a credit card that has been stolen from you. It is defined as the unlawful or irresponsible use of another person’s credit card information for personal purposes. Identity theft includes credit card fraud, which is more prevalent today. Scammers begin transactions from your account without your awareness by using the card data you provide to carry out improper behavior. Such occurrences have made credit card security necessary.
How Credit Card Data Is Often Stolen?
There are various methods through which scammers try to steal your data and they are:
Skimming:
Scammers install a card skimmer, a piece of equipment stored on the credit card reader. This gadget
will record the information when your credit card is swiped to make a
transaction.
Dumpster diving:
When your throw away invoices or other paperwork that contains your whole credit card number,
fraudsters might use that information to make off with your money.
Hacking:
Criminals can access the systems of business you’ve done business with or those that handle credit card
transactions. Once this happened, they will commit data breaches.
Phishing:
Scammers may trick customers into exposing their sensitive information through the use of
phishing.
How Could Credit Card Fraud Be Avoided?
Consumers usually ask how to prevent credit card theft. These basic credit card usage manners hold the key to the solution: Avoiding fraud
Avoiding fraud with a Zero Liability Policy:
The majority of credit cards include zero-liability policies that prevent the cardholder from liability for damages resulting from fraud. Thus, for any unauthorized mobile, online, in-person, or mobile app transactions, the consumer will not be responsible for it. Similarly, there are a few limitations to the zero liability policy and they might not be applicable to all international or business credit card transactions.
Never pay in advance:
Online scammers send unpredictable emails asking credit card holders to pay taxes or fees to get a huge reward, inheritance, or foreign investment. Never pay in advance for such schemes as they are online frauds. You may lose both the money and your credit card information to future fraud.
Before sending any payments, take your time:
In several ads, consumers are urged to “paynow” to receive a discount. Never allow such offers to force you into paying before you analyze the benefits and drawbacks of the product or service, as well as the legitimacy of the website.
Pay using a mobile wallet:
Due to the use of tokenization technology, mobile wallets enable secure payments at retail locations. They keep the money in your wallet that is necessary for the transaction. This prevents retailers from obtaining credit card information. Since, the phone features a password-based, swiping-based, or fingerprint authentication mechanism. This stops anyone from making payments over the phone.
Setting up a payment limit:
All credit card companies provide the option to define payment thresholds for contactless payments, online and e-commerce purchases, ATM withdrawals, and PoS transactions. The biggest amount that can be put on the card is the default setting for the limit. It is preferable to
adjust these parameters to the basic requirements for regular transactions. It also allows you to change the limitations at any moment from the mobile application.
Conclusion
To use a credit card responsibly and wisely you should be familiar with both the terms and conditions of a credit card. They include several critical aspects that should be checked carefully. Credit card issuers provide the payment return option to protect their clients from fraud and losses, but cardholders must also be aware of a few limitations. One of the most crucial things to remember is to get in touch with your card issuer as soon as you wish to dispute a transaction or report illegal activity.
Read More: Tips for Managing Your First Credit Card
