When financial institutions introduced the smart card with EMV technology, we all hoped we’d finally see an end to the ever increasing cases of online payment card fraud. But technology, like a sword that cuts both ways, provided new ways of defrauding masses still.
It would seem that for every technological advancement meant for the good of humanity, there are two or three technologies of equal brilliance developed to counter the positive.
The industry shift to EMV saw fraudsters abandoning credit cards because they couldn’t interfere with the cryptographic EMV chip. As a result, Point of Sale (POS) fraud declined significantly.
Now, they’re targeting debit cards and prepaid cards more. Through these two types of cards, fraudsters stole a total of $1.7 billion in 2017. A year before, the same fraud method had netted these criminals $1.8 billion.
So is the lower amount a good sign? Not necessarily. And if you’re one of the victims whose information was stolen and used to defraud you, you certainly wouldn’t feel that way.
To steal your money, fraudsters rely on weak controls, which make it easy for them to hijack the card for criminal use. This is the primary method used for Card Not Present credit card fraud, which unfortunately, is on the rise. It’s also used to perpetuate existing card fraud.
Why is it so Easy for Fraudsters to Get your Information?
There are several factors that make it possible for payment card fraud to thrive.
Cyber criminals rely on data breaches to access the information they need. The more data they can collect, the higher their chances of combining the right data matches for New Account Fraud (NAF).
In the eyes of a fraud master, every data is useful data and every data collected brings them closer to successfully accomplishing their foul mission.
Some types of personal data fraudsters use to accomplish their foul mission includes:
- Social Security numbers
- Private account numbers
- Credit card numbers and ATM PINs
- Debit card numbers and PINs
- Online banking credentials
- Checking account numbers
- Driver’s license numbers
- Health insurance details
- Medical records
- School records and military IDs
Fraudsters use malware to access users’ devices, including PCs and smartphones. This malware, which includes Trojans, key-logging software, and phishing bots, then intercepts your identification information and sidestep s authentication.
Weak verification processes
Since most financial institutions still use the same old forms of customer verification, fraudsters posing as you divulge some of the personally identifiable information they’ve acquired to make it appear as though they were the real customer and combine this with false information to make it virtually impossible to trace them.
With this method, they can open multiple copycat accounts using your identification and use the accounts to carry out massive financial fraud.
How can you Stay Safe from Credit Card Fraud?
Monitor your Card Usage
If you discover unusual activity involving your credit card information, notify your bank immediately. Fraudsters will try to fool you into logging into your financial services provider’s website in order to steal the additional information they need from you to make their fraud a success.
Be suspicious of any emails or messages you get with links asking you to verify your information. If you have not transacted online recently, this should sound warning bells. But even if you have, your bank would not require you to verify your information in such a suspect way.
Ensure that all your payment cards are EMV secured
Many financial institutions have replaced the old with the smart card, but it’s always good to confirm, especially if you’re signing up for a card from a new financial services provider. Use the EMV supported card only when paying for items at POS.
Some POS do not support EMV card payments. You’re better off using a cash payment if possible or another supported form of payment if transacting online.
Choose a Financial Services Provider with a Strong Security Layer
Before signing up with any financial services provider, consider the kind of security features they have in place. They should be using the latest security protocols. The most current one is 3D Secure (3DS 2.0). If they are still on older security protocols, you may want to reconsider using their services until later when they’ve upgraded their security features.
Fraudsters will break through the firewalls of older security protocols much more easily than they would a new one. It will take them a while to find ways of breaking into the new system, but by the time they do, it will have been upgraded to a newer version which isn’t as easy to break into.
It’s an ongoing cycle. You just have to ensure that you’re on the team that’s ahead of the game. That’s the only way to beat fraudsters.
Choose Providers who use Modern Proof of Identity Technology
Sign up for credit card services with a provider who will not only ask you to verify your identify, which fraudsters can easily do, but demand proof of identity.
Activate 2-way Alerts
Use two-way alert technology to authorize/finalize every transaction from your mobile device. This makes it impossible for fraudsters to successfully transact with your card details without your knowledge.
Put Limitations on your Card
Limit the amount that can be transacted in a single application, the number of times you can transact in a day, which platforms the card can be used on, and the geographical locations within which the card can be used.
What should you consider when choosing a Payment Card Service?
Some payment card providers offer a better customer experience based on the features they have. Consider these factor when choosing a payment card service:
- Proof of Identity features
- Use of EMV technology
- Online access of features
- Has no overdraft fees. You don’t want to be obligated to pay enormous amounts of cash in charges when someone misuses your card.
- Gives rewards on purchases. Rewards notifications can alert you when someone uses your card information to make purchases.
Keeping your credit card information safe requires you to be judicious about where you use your details and add security layers that put you in ultimate control of each transaction.