Credit card and Debit card Fraud and Prevention

What is Fraud?

Fraud can be defined as ‘a wrongful or criminal deception intended to result in a financial or personal gain.’

In the field of law, ‘fraud is a deliberate deception to secure unfair or unlawful gain, or to deprive a victim of their legal rights.’

It is a term we are quite familiar with since we know the frequency of it occurring often, in the world.

An Increase in the Incidence of Fraud

There has been a continual increase in the number of fraudulent activities on an individual’s financial accounts, particularly with the introduction and use of plastic payment cards, i.e. debit and credit cards. In the U.S., a card gets blocked every second as a result of some fraudulent activity taking place. These criminals intend to secure financial gains whilst severely hurting people by burning holes in their pockets.

This has, in turn, led authorities to formulate policies that provide security measures to protect customers.

Steps to protect your digital money

What steps can we take to protect ourselves from such fraudsters?

1. Pin verification

The most popular option to adopt is the Pin Verification Method. A 3 to 4 digit PIN must be made, the details of which must not be shared with anyone. The unique PIN has to be entered to verify a transaction whenever it is being made.

2. E-Wallet

Third party digital wallets like PayPal or Citrus are very secure and can help facilitate online transactions. These online wallets also remove the need for plastic payment cards.

3. Prepaid Card

A Prepaid card is a very calculative way to reduce risk. One can transfer money onto a prepaid card according to their preference. On owning multiple cards- if one gets compromised, you will not lose all your money.

4. Transaction Password

Companies like Visa and Mastercard have introduced a new security feature. While making an online transaction, the third-party window will now ask for a transaction password to verify the account before accepting the payment.

5. Avoid High-Risk Website

Avoiding these high-risk sites will save you from fraudsters, and could also help you keep a healthy mind.

Websites displaying negative content, or promote gambling, usually operate in the absence of a secure payment platform. There is a high possibility of these sites selling your personal information or card details, as well as these websites using said information for suiting their own needs. Avoiding these high-risk sites will help prevent fraudsters from accessing users’ personal and financial information.

Conclusion

Each generation witnesses the emergence of a kind of technology that has the ability to radically change the way economies and societies function. The existence of obsolete technology always has on its fringe, people that seek to take advantage of the prevailing system to further their own gains.

Criminals evolve as technologies evolve, where they try to stay ahead of the game by hacking the system and exploiting its weaknesses to further their agendas. The current financial system has a series of holes that criminals can exploit. The digitization of transactions has further increased the risk of fraudulent activities.

Blockchain is the disruptive technology of this decade. It has the ability to revamp and restructure the entire financial system, even to the extent of making banks and other financial institutions obsolete. Since the technology is decentralized and works on a peer-to-peer network sharing platform, the need for intermediaries is negated.

Add to this, the Blockchain’s basis in cryptology makes it difficult even for the sharpest hacker to infiltrate. One would have to go through a series of billion algorithms that require heavy computing power, to be able to breach the network.

Are Blockchain transactions completely secure? They are more secure than traditional banking and transactions in centralized financial institutions. However, there have been high-profile thefts and hacks taking place in the Blockchain space, but that is also the result of this technology being extremely new.

This technology is yet to have its influence enter the mainstream consciousness. It’s a space that is so new that there aren’t appropriate laws in place to accommodate its cohesiveness. This technology is so powerful that it has the ability to give rise to newer economic policies, thereby influencing society as well.

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