First-time credit card user? Avoid these mistakes

If you are new to credit cards you must know that a fraudster is probably keeping a close watch on you. Most consumers are likely to be first-time users, considering the increase in number of credit cards in the country.

In January, the total number of credit cards was 45.17 million, compared with 36.24 million in the same month last year—around 9 million credit cards were added in a year, according to data released by the Reserve Bank of India.

There have been multiple cases where consumers have turned victim to fraudulent credit card transaction, especially first time credit card users. Here is how you should protect yourself:

Use dynamic password

Most credit card frauds are primarily phishing frauds. Basically, fraudsters pretend to be calling from a bank or a company and customers tend to fall prey to it.

“One option is to move away from static passwords. Once a static password is compromised, the fraudsters can use it at multiple places. Typically the fraudster will get your card number, expiry date and CVV plus the static password. In case of OTP, even if the misuse happens, it happens only to that extent. It is institution-specific—certain companies allow dynamic while others opt for static. It is also a choice given to the customer by some banks,” said Sudipta Roy, head, unsecured assets and cards, ICICI Bank Ltd.

Static passwords are those which is constant and can be used for all the transactions as many times as you want. A dynamic password changes every time you want to process a transaction—hence, every time you get a new password.

Don’t disclose any information

Financial institutions constantly mention that you should not disclose your card details and your password. “The challenge is people don’t pay attention to it. People like to share information whether it is photocopies, email id, phone or address for freebies, opening themselves for frauds. Never share your details,” said Mukul Shrivastava, partner, fraud investigation and dispute services, EY. Usually a fraudster comes through a digital channel or on call and tries to get access to password. “For instance, someone poses to be from an income tax department and tells you about a refund, for which you have to give your card details and your password. Don’t share card details, online password or PIN,” said Ambuj Chandna, senior executive vice-president, and head, consumer assets, Kotak Mahindra Bank Ltd. Remember, don’t give your card information to anyone.

Pay attention when your card gets swiped

Sometimes, the information of your card can get leaked when it is in use. “One of the methods of misuse is double swipe on retail outlets. They will swipe on the machine and then also insert the card in the machine, which needs to be stopped. In that case, the magnetic strip gets swiped which then stores the data such as expiry date and card number in the system which can then get leaked,” said Roy.

You can also limit the amount of transaction on your credit cards—a facility provided by card issuing companies on their net banking platform. Another way to protect yourself from fraudsters is by changing your static passwords at regular intervals. Also keep an eye on all your SMS as it will constantly update you on any transactions on your card.

First Published: Mar 19, 2019 12:11 IST