How many times do we hand over our credit card to the waiter at the end of a scrumptious meal at a good restaurant? The thought never enters our mind that this simple act can easily defraud us. Think you can relax as you've never made an online purchase? Don't sit back as yet. Most of us have never made a purchase online but there are several ways your credit card can be misused.

 

Her are two examples of the recent past that should make us sit up and be on guard.

 

This credit card racket was uncovered in the tourist areas of Agra and Jaipur. In this case a credit card was misused when a foreign tourist gave it to a hotel waiter or an employee to pay his bills. After swiping at the machine given by the bank at the hotel counter, the waiter swiped it again in the skimmer machine, given by the shopkeeper. Racketeers regularly keep in touch with such waiters and collect the lipstick-size skimmers.

 

Recently another racket of misuse of credit card came to light in Thane near Mumbai. A sales clerk of the Globus store would pass on copies of the charge slip to his accomplices and they would then purchase airline tickets with the help of that information. ICICI Bank officials got the wind of it and sent out an alert.

 

These are only few incidents of scams being discovered. But there are surely many of  which are undiscovered or still cooking in crooked minds. So what can you do to keep your credit card from being misused?

 

Precautions you must take to ensure safe usage:

• On receipt of a new card ensure that it is in sealed condition and that the seal is not tampered.
• Monitor your account regularly either on the internet or from call centres.
• Also subscribe to email and mobile alerts to keep track of card usage. Ensure that the card is swiped in your presence wherever the card is presented.
• Whenever you travel abroad keep track of your transactions.
• Sign on the back of your new card as soon as you receive it.
• Preserve the card account numbers and the personal identification number in a confidential place.
• Periodically check your cards to ensure that none are missing.
• Destroy and dispose all documents that mention the card number, such as copies of receipts, airline tickets, travel itineraries etc.
• Memorize your card's PIN number
• Personal account information should never be shared with anyone unless payment for the purchase is being done from that account
• Cancel all inactive accounts

(Also read - Prepaid cards: Hedge exchange rate risks on foreign travel )

 

Your card company is working with you

The credit card company and bank also tries its best to prevent misuse of the card. "High value transactions on new cards are allowed only by manual authorization. Bank does tele-calling on abnormal/suspicious and close monitoring of transaction trends for customer confirmation and educating regular card usage," says Sachin Khandelwal, Head-Credit Cards, ICICI Bank.

 

Meanwhile companies like Master card have introduced several innovative measures to prevent the misuse of credit cards. "From holograms and the tamper-evident signature panel to card validation codes, MasterCard security innovations have been adopted as industry standards. Recently we have introduced MasterCard Internet Gateway and MasterCard 2-factor authentication service," asserts Nitin Gupta, Country General Manager, South Asia, MasterCard Worldwide.

 

Your debit card needs protection too.

Debit cards need even more protection than credit cards since they are open to access to your entire bank account and not a limited credit. Debit cards can also be misused but the proportion of such misuse is very low in India. "The MasterCard Maestro debit card is a PIN based product, which ensures high levels of security. The MasterCard unembossed debit card has a magnetic strip, which reduces the possibility of fraud considerably as no one can take an imprint of the card and misuse the data available," says Nitin Gupta.

 

Does insurance help?

If you read the fine print, insurance cover is only for a lost card and it gets activated only after you have reported your loss of card. It does not cover frauds like these.

Who will pay for the money that has been defrauded is still a minefield open to speculation and litigation. So prevention is the only answer.

 

The author, Shalini Amarnani, is a freelancer.

 

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