Credit card online fraud is on the rise with the increase in digital transactions, posing a risk to both individuals and businesses. Cybercriminals steal data through methods such as phishing, breaches, skimming, and other tactics. These frauds can lead to financial loss, damage to your credit profile, and additionally, significant stress.
As credit card fraud affects credit scores, it is crucial to take security measures to protect yourself from these risks. By implementing effective strategies to safeguard your financial information, you can prevent a decline in your credit score and protect your credit from unauthorised use.
Ways in Which Credit Card Fraud Occurs
Credit card fraud can occur in various forms, including counterfeit cards, skimming, stealth, phishing, and more. To better understand how to protect your credit from fraud, it is important to be aware of the types of credit card scams that are currently prevalent.
- Counterfeiting Cards
A counterfeiting card scam involves copying information from your stolen or compromised card. This often includes the use of skimming devices to replicate data and make unauthorised transactions.
- Skimming
Skimming devices are used on card readers, such as those found at ATMs, to capture credit card data from the magnetic stripe. The data copied from this device can then be used to create a fake card, which is used to carry out illegal transactions.
- Lost or Stolen Cards
If your card is lost or stolen, it can be used to make fraudulent transactions. This can continue until you report the incident to your card issuer and request that the card be blocked immediately.
- Phishing
Phishing is another form of credit card fraud that uses emails, phone calls, and text messages to deceive you. Cybercriminals collect your credit card information and other sensitive details through these channels, often tricking you into making upfront payments.
- Mail Theft
Cybercriminals may access your credit card statements or new card information sent via post. With this information, they can make unauthorised transactions.
- Identity Theft
This involves the stealing of your personal information, which is then used to create a fake identity. Fraudsters can use this fake identity to make illegal transactions in your name.
Tips to Prevent Credit Card Fraud
To prevent credit card fraud, regular monitoring, securing your financial details, and avoiding upfront payments are some suggestions you can follow. Here are some extra steps you can take to safeguard your financial information.
- Securing Login Details
You must never share your ATM card PIN, One-time Passwords (OTPs), mobile passwords or Internet banking passwords with anyone. You must avoid sharing it with your friends and family members over an email or suspicious calls.
- Avoiding Upfront Payments Online
Fraudsters send you random emails or links that redirect you to a suspected payment gateway in the name of prize, investment, or taxes. They lure you into making an upfront payment and you may lose a huge amount of money. You must avoid upfront payment online without checking for the receiver.
- Examine Before Paying
Before paying to a UPI ID or phone number, always take your time. In the name of discounts, offers, and cashbacks, fraudsters pressure you to make payments. You must always take your time before making a payment to check if the offer is valid or not.
- Be Aware of Phishing and Virus
Phishing is a credit card online scam used by cybercriminals to trick you into revealing your credit card details. By using similar logos and tags for websites and institutions, they collect your financial information. You must remember that companies never ask you to provide information over the phone, email, or text.
- Assess Skimming
These devices steal your credit card information through ATMs. At ATMs, always check for any external device before entering your card. Also, try to use your contactless card or virtual card to make such payments in restaurants and with other retailers. By eliminating the use of chip cards physically, you can be aware of skimming fraud.
- Using Different Cards for Autopay and Dail Expenses
For autopay, subscriptions, and memberships over websites and mobile apps, you must keep separate credit cards. Because you avoid the usage of one card at many merchants, you can save yourself from getting into a big loss if any fraud happens. While this tip does not help you prevent fraud, it helps avoid extensive credit loss.
- Payment Limit
All credit cards provide the facility of setting up a payment limit as per the rules of your credit card company. By default, the limit is set to maximum, but you must change the settings depending on your regular expenses.
- Using Mobile Wallets
Mobile wallets are safe because they extract amounts from your cards and save them from frequent usage. With the use of mobile wallets, you can save your credit card details from being shared with anyone else. A mobile wallet also comes with security measures like fingerprints, swipes, or passwords.
- Using Contactless Credit Cards
Many credit card companies provide you with the option to pay virtually. These credit cards come with the tap-to-pay feature that saves your card data from being handled by many users.
- Monitoring Transactions
By monitoring transactions, you can know if any unauthorised transactions happen on your card. Through this, you can also check out fraudulent activities and report them to the card company and financial authorities immediately.
Steps to Report Credit Card Fraud
After following these suggestions, if you face credit card fraud, you can report it to the credit card company. This will save you from excess loss of funds and block your card to prevent more such transactions. To report a credit card fraud:
- You can contact the credit card issuer or company through SMS, mobile app, email, customer care, website, or internet banking
- Gather fraud-proof such as transaction numbers, screenshots, and address-proof
- You can then file an online complaint with the cybercrime cell at https://cybercrime.gov.in/ or call them at 1930
- If you are not able to reach the cybercrime cell, you can register an FIR at your nearest police station with the necessary proof and documents
To prevent common and dynamic credit card fraud, you must be aware of common scams and check out security measures. Regular monitoring, using secure payments, and avoiding suspicious payments help you save your personal information.
But, if you suspect fraud, you can always report it to your issuer and relevant authorities. Reporting credit card fraud may help you recover lost funds and save your sensitive information from further misuse.
