It was believed that plastic money was safer than cash, but now it could take you to the cleaners given the alarming number of credit card scams that have been detected in the country.
Employees working at fuel stations, shopping malls, supermarkets etc. where credit cards are widely used are involved in these various scams.
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| Nalin Wijeratne |
A credit card specialist said the main contributory factor for the increase in card fraud incidence here was that the merchants who accept payment cards do not follow the proper card acceptance procedures in spite of the fact that the relevant banks have given them training .
“In some instances the merchant employees connive with perpetrators of payment card frauds,” Consultant for Cards and Alternate Distribution channels Nalin Wijeratne said.
He said the acquiring banks which are those that have set up the merchant network for accepting cards and issuing banks, the banks that issue payment cards have taken many steps to mitigate payment card frauds.
The frauds include usage of counterfeit cards, skimming and use of stolen or lost cards.
Skimming involves the replication of electronically transmitted data that enables a valid authorization to occur.
This type of fraud involves the copying of encoded data from one credit or debit card’s magnetic stripe to a counterfeit card. Often, this duplication is not detected until the perpetrators have made many fraudulent transactions,” he said.
Mr.Wijeratne said criminals have become increasingly tech-savvy and have found ways to hack into company computer systems to gain access to confidential information including customer information.
To ensure that credit card fraud does not take place, Mr.Wijeratne said that issuing banks should ensure they issue chip cards, which prevents skimming and even if a card is swiped through a point of sale terminal, the card reader reads the content of the magnetic stripe of the card and initiates an authorization message, which would be sent to the acquiring host, which in turn routes the relevant message to the issuer bank based on the Bank Identification Number of the card.
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| The skimmer that is used to skim data on the cards. Pix by Hasitha Kulasekera |
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