Credit card risk - Dos and Don'ts on Phones: 5 critical points to note if you don't want to lose money | Tech News

Credit card risk - Dos and Don'ts on Phones: 5 critical points to note if you don't want to lose money

Credit card risk - Must Dos and Don'ts: How risky is it to give card details over the phone and how do I reduce the chance of fraud?

By:PTI
| Updated on: Jan 27 2024, 14:37 IST
5 best budgeting apps you need to try: From Monefy to Spendee, know how to save money
image caption
1/5 Monefy: Monefy is a user-friendly financial organizer and tracker that can simplify the process of monitoring your spending, and daily expenses, and increase overall financial awareness. Users can add their expenses with a single click, as well as get real-time financial status and updates on spending patterns. (Google Play Store)
image caption
2/5 Money View: Money View is a personal finance manager app that helps you track and manage your expenses easily. Apart from allowing users to track their expenses automatically, get payment reminders, and check their account balances all in one place, it also offers an instant personal loan of up to Rs. 10,00,000. (Google Play Store)
image caption
3/5 Spendee: Spendee can come in handy if you’re poor at managing your finances wisely. With the app, users can track their spending and optimize their budgets. It also features simple infographics and stylish graphs that display your spending in a manner that is easy to grasp. Moreover, you can save money for categories you spend the most on by creating budgets and sticking to them. (Google Play Store)
Credit card risk
4/5 Wallet: The Wallet: Budget Expense Tracker app can help you plan, manage, and get a report concerning your finances. With 3500 supported banks, it tracks and logs all your spending automatically. You can also get insightful reports about the state of your finances. Other features include multiple currency support, Automatic cloud sync, Receipts and warranties, Categories and templates, geo-mapping transactions, hash-tagging, and Shopping lists. (Google Play Store)
Credit card risk
5/5 EasyBudget: If most budgeting apps intimidate you with a myriad of features, then EasyBudget can come in handy. It has a clean and minimal interface without any fancy but confusing graphs or charts. With EasyBudget, users can track their spending, keep daily expenses in check, as well as get monthly reports on their financial status. (Google Play Store)
Credit card risk
View all Images
To minimise Credit card risk, do not divulge information to anyone on the phone and instead use virtual credit card. (REUTERS)

(The Conversation) Credit card risk - Must Dos and Don'ts: Paying for things digitally is so common, most of us think nothing of swiping or tapping our credit card, or using mobile payments. While doing so is second nature, we may be more reluctant to provide card details over the phone. Merchants are allowed to ask us for credit card details over the phone – this is perfectly legal. But there are minimum standards they must comply with and safeguards to protect consumer data.

So is giving your credit card details over the phone any more risky than other transactions and how can you minimise the risks?

1. How is my credit card data protected?

For a merchant to process card transactions, they are expected to comply with the Payment Card Industry Data Security Standard. This is a set of security requirements designed to protect cardholder data and the trillions of dollars of transactions each year.

Compliance involves various security measures (such as encryption and access controls) together with strong governance and regular security assessments.

If the information stored by the merchant is accessed by an unauthorised party, encryption ensures it is not readable. That means stealing the data would not let the criminals use the card details. Meanwhile, access controls ensure only authorised individuals have access to cardholder data.

Though all companies processing cards are expected to meet the compliance standards, only those processing large volumes are subject to mandatory regular audits. Should a subsequent data leak or misuse occur that can be attributed to a compliance failure, a company can be penalised at levels that can escalate into millions of dollars.

These requirements apply to all credit card transactions, whether in person, online or over the phone. Phone transactions are likely to involve a human collecting the card details and either entering them into computer systems, or processing the payment through paper forms. The payment card Security Standards Council has detailed guides for best practice:

A policy should be in place to ensure that payment card data is protected against unauthorised viewing, copying, or scanning, in particular on desks.

Although these measures can help to protect your card data, there are still risks in case the details are misplaced or the person on the phone aren't who they say they are.

2. Basic tips for safe credit card use over the phone

If you provide card details over the phone, there are steps you can take to minimise the chance you'll become the victim of fraud, or get your details leaked.

a. Verify the caller

If you didn't initiate the call, hang up and call the company directly using details you've verified yourself. Scammers will often masquerade as a well-known company (for example, an online retailer or a courier) and convince you a payment failed or payment is needed to release a delivery.

Before you provide any information, confirm the caller is legitimate and the purpose of the call is genuine.

b. Be sceptical

If you are being offered a deal that's too good to be true, have concerns about the person you're dealing with, or just feel something is not quite right, hang up. You can always call them back later if the caller turns out to be legitimate.

c. Use secure payment methods

If you've previously paid the company with other (more secure) methods, ask to use that same method.

d. Keep records

Make sure you record details of the company, the representative you are speaking to and the amount being charged. You should also ask for an order or transaction reference. Don't forget to ask for the receipt to be sent to you.

Check the transaction against your card matches the receipt – use your banking app, don't wait for the statement to come through.

3. Virtual credit cards

In addition to the safeguards mentioned above, a virtual credit card can help reduce the risk of card fraud.

You probably already have a form of virtual card if you've added a credit card to your phone for mobile payments. Depending on the financial institution, you can create a new credit card number linked to your physical card.

Some banks extend this functionality to allow you to generate unique card numbers and/or CVV numbers (the three digits at the back of your card). With this approach you can easily separate transactions and cancel a virtual card/number if you have any concerns.

4. What to do if you think your card details have been compromised or stolen? 

Quick action is essential:

- call your bank and get the card blocked so you won't lose any more money. Depending on your situation, you can also block/cancel the card through your banking app or website

- report the issue to the police or other relevant body

- monitor your account(s) for any unusual transactions

- explore card settings in your banking app or website – many providers allow you to limit transactions based on value, restrict transaction types or enable alerts

- you may want to consider registering for credit monitoring services and to enable fraud alerts.

5. So, should I give my card details over the phone?

If you want to minimise risk, it's best to avoid giving credit card details over the phone if you can. Providing your card details via a website still has risks, but at least it removes the human element.

The best solution currently available is to use virtual cards – if anything goes wrong you can cancel just that unique card identity, rather than your entire card. 

(The Conversation)

Follow HT Tech for the latest tech news and reviews , also keep up with us on Whatsapp channel,Twitter, Facebook, Google News, and Instagram. For our latest videos, subscribe to our YouTube channel.

First Published Date: 27 Jan, 14:34 IST
NEXT ARTICLE BEGINS