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Credit Card SecurityFraud can pose a major threat to credit cards due to the low level of security of the credit card system. For example credit card numbers are stolen and used swiftly before they are deemed as stolen. Despite this worry, credit card companies aim not to eradicate it but to decrease it, so that both fraud and fraud prevention costs are reduced.How is fraud committed? Fraud is can be committed both online and offline. For example a merchant might simply email all credit card details to a person ready to manually input the details at a credit card terminal. Straight away this becomes a security risk as the card details are now in the hands of a human who has access to the details before the purchase actually goes through the terminal. Details can also be copied online through people hacking into sites with card detail on them. What measures are being taken to make credit cards more secure? The credit cards themselves have been subject to change in order to make them more secure. They are being replaced with tamper opposing smart cards which help in reducing forgery. Also the merchant’s on-line verification system is being improved. It requires a PIN number, known only to the card holder. This way the card can only be used with the use of the PIN. This can only be obtained from the card holder themselves which seriously reduces the risk of fraud. And finally, there is now another set of digits located on the back of the credit card which are requested for phone payments etc. when the customer is not actually by the card terminal. Again, this makes credit card phone payments a lot more secure. Credit history All an individual’s dealings with credit are monitored. Bad credit dealings such as late or missed payments are logged by credit bureaus. Bad behaviour such as this can seriously affect your credit rating and remains for years on your credit history. This makes future attempts to obtain credit very difficult and it can be for a very long time depending on the nature of your credit history. |
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