Personal Finance

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Credit Card Fraud Detection: Know the Way to Avoid

Published On May/17/2024

With the increasing dependency on plastic money, credit card fraud can prove to be extremely damaging. Yet, people tend to neglect basic steps to avoid credit card fraud. Every individual must take the necessary steps to avoid the perils of credit card fraud.

Modern-age frauds can range from theft of cards, account takeover, and counterfeiting to email/telephone orders (MO/TO frauds) and more. The banking sector has taken multiple steps towards the prevention of credit card fraud. However, consumer education is a key strategy when it comes to avoiding fraud. Here are some simple ways a consumer can self-educate and help avoid credit card fraud.

Keeping the Credit Card Safe

The primary step for credit card fraud prevention is to keep the credit cards in a place which is not easily accessible to others. Make sure that a new credit card kit/envelope is not tampered with, and sign the back of the card as soon as you receive it. Always keep the credit card secured in a small wallet which will make it difficult for snatchers or pickpockets. After every purchase, never forget to put the card away as soon as possible because thieves can store a digital imprint of the credit card through snapshots using cell phone cameras. It is also recommended to confirm the possession of the credit card in your wallet from time to time, even if you have not used it in a while.

Monitor Credit Card Transactions Online

Many banks and financial institutions allow you to monitor your credit card transactions via SMS and email alerts, and also via online banking or mobile apps. You can get real-time alerts that enable tracking of credit card spending.

Avoid Paper Trails of Your Credit Card Number

Credit card billing statements usually have the full credit card number printed on them. As a credit card user, always remember to shred the statement before dumping it into the bin. Expired and cancelled credit cards should also be shredded.

Signing Blank Receipts

The amount on the credit card receipt should be thoroughly verified before signing the bill. If the receipt has blank spaces, it is advisable to fill them with zeros (0) or scratch through them before signing.

Never Make Credit Card Information Public

Always be aware of scammers and potential phishing threats. Never provide your credit card number and other sensitive information over the phone or through text messages. Scammers usually pose as new service issuers or providers of lucrative business offers to trick you into leaking sensitive information about the credit card. Ensure that you memorise your PIN and change it frequently to avoid misuse. Many banks allow you to change your PIN online easily.

Double-Check Your Online Transactions

Be cautious of phishing threats posed through email links that mimic bank logos, credit card providers, or businesses that require personal information. Verify the legitimacy of the online website you are making a purchase from. This can be done by checking if another website of the same or similar name exists. Always make sure that the website is secure by checking for the ‘https://’ in the address bar of the site. Exercising caution goes a long way in avoiding credit card fraud.

Immediate Reporting of Lost or Stolen Card

Report a lost or stolen card to the service provider as soon as possible. The sooner the intimation of a lost card, the quicker the credit card fraud prevention. Always keep the credit card company’s customer service number in your phonebook to avoid delays in informing the service provider in case of credit card loss or theft. Only with prompt reporting can one avoid credit card fraud in such cases.

Also read about: Aditya Birla SBI Cards

Review the Billing Statement

Consistently review the billing statement for each month. Unauthorised charges are a sure sign of credit card fraud. Under such circumstances, the extent of the fraud is immaterial, as even a small unauthorised charge should be reported immediately to the credit card service provider. Usually, in this case, the service provider will instruct you to close the account and apply for a new account number. Most banks offer SMS and email notifications each time the credit card is used. In case of unauthorised transactions, it is recommended that you report it immediately and block the card.

Making Strong Passwords

In this digital age, credit card numbers are usually stored online for ease of access and one-click purchases. A basic rule for making a strong password at some of the most secure websites is to use a combination of both upper and lower case characters and numbers. It is also advisable to memorize the password and avoid jotting it down on a piece of paper for future reference.

Using RFID-Blocking Wallets

Contactless credit cards usually come with an RFID chip embedded in them, allowing for a smoother operation where users do not need to swipe the card. Credit card fraudsters can scan the RFID data of a card while standing next to a person. Investing in an RFID-blocking wallet can be pivotal to credit card fraud prevention.

By following these steps, you can significantly reduce the risk of credit card fraud and ensure the security of your financial transactions.