In the last few days I have seen multiple articles pop up regarding credit card frauds performed internationally on Indian Credit Cards. If you want to read more about the frauds themselves, please refer to this article. The possibility of use of malware is the topic of this article. If you are already a victim of credit card fraud, you might want to read this article.
But in my article, I am about to offer three suggestions, which if implemented by the banks, can make credit cards much safer than they are today.
Voluntarily Lower Credit Limit
Banks should provide their customers with the choice to lower the credit limit below that offered by the banks. Suppose I have a Rs.1,00,000 credit limit as defined by the bank but I do not use so much of the limit usually. Then I should have an option to lower the limit temporarily to any amount I wish, say Rs.25000. I should be allowed to do this online, at ATM machines, or using phone banking. Similarly, if I am about to make a higher value transaction, I should be allowed to raise my self imposed limit to a maximum of that allowed by the bank. Even this I should be allowed to do using my ATM pin or online netbanking password or though phone banking.
The advantage of allowing such a dynamic reduction and increase of the credit limit is that it will limit the fraud liability should such an eventuality occur. It is easier on the pocket to challenge a fraudulent Rs.25,000/- transaction than a Rs.1,00,000/- transaction
Voluntarily Disallow International Usage of Card
If I have an international card, but I do not frequently visit other countries, I should be allowed to dynamically turn off possible usage of my card internationally. If I am travelling, I could turn this facility on through an ATM machine, or through netbanking, or through phone banking. If I forget to do so while in India and use an ATM outside, the bank may even charge a fee to do so.
Voluntarily Disallow Non-secure Transactions
The banks must also provide the facility for customers whereby they can declare that any transactions done on merchant websites which do not have Verified by Visa or Mastercard 3D security enabled should be rejected by the bank. This single facility will prevent a lot of fraud which happens on e-commerce websites.
I am releasing these ideas in the open so that banks can start offering some such facility to all of us.
If you are a bank and would like a discussion, please do not hesitate to contact me. If you are a customer and would like to write to your bank, you are free to quote the contents of this blog entry.
But in my article, I am about to offer three suggestions, which if implemented by the banks, can make credit cards much safer than they are today.
Voluntarily Lower Credit Limit
Banks should provide their customers with the choice to lower the credit limit below that offered by the banks. Suppose I have a Rs.1,00,000 credit limit as defined by the bank but I do not use so much of the limit usually. Then I should have an option to lower the limit temporarily to any amount I wish, say Rs.25000. I should be allowed to do this online, at ATM machines, or using phone banking. Similarly, if I am about to make a higher value transaction, I should be allowed to raise my self imposed limit to a maximum of that allowed by the bank. Even this I should be allowed to do using my ATM pin or online netbanking password or though phone banking.
The advantage of allowing such a dynamic reduction and increase of the credit limit is that it will limit the fraud liability should such an eventuality occur. It is easier on the pocket to challenge a fraudulent Rs.25,000/- transaction than a Rs.1,00,000/- transaction
Voluntarily Disallow International Usage of Card
If I have an international card, but I do not frequently visit other countries, I should be allowed to dynamically turn off possible usage of my card internationally. If I am travelling, I could turn this facility on through an ATM machine, or through netbanking, or through phone banking. If I forget to do so while in India and use an ATM outside, the bank may even charge a fee to do so.
Voluntarily Disallow Non-secure Transactions
The banks must also provide the facility for customers whereby they can declare that any transactions done on merchant websites which do not have Verified by Visa or Mastercard 3D security enabled should be rejected by the bank. This single facility will prevent a lot of fraud which happens on e-commerce websites.
I am releasing these ideas in the open so that banks can start offering some such facility to all of us.
If you are a bank and would like a discussion, please do not hesitate to contact me. If you are a customer and would like to write to your bank, you are free to quote the contents of this blog entry.
