What is a credit card fraud?

13 Apr 2024 By PAYCEC

Credit card fraud falls among the many forms of financial crimes, whereby fraud is transacted using credit or debit card information to acquire money to be used in other sinister-purposed activities. It could come in various forms, such as stolen card details, card skimming, phishing, or identity theft. Therefore, knowing how credit card fraud works is very important for consumers and businesses to take heed of the signs of fraudulent activity and hence take proper measures as a preventive action to causing them financial harm.

Types of credit card fraud

• Card theft: This is a type of physical theft in which the thief snatches the credit or debit card from an individual to make some unauthorized purchases or withdrawals. He can remove the card from a purse, wallet, or mail, or the thief could use a sophisticated approach such as shoulder surfing or pickpocketing.
• Card skimming: The skimming captures the information on the magnetic stripe, which has been coded; it includes the number of the card, the expiry date, and sometimes the name of the owner. Mounting a skimming device on ATMs, gas station pumps, or even point-of-sale locations enables fraudsters to secretly collect card data.
• Phishing: According to this scam, poisoning is presented through an email, SMS, or telephone in the form of a scam in which purportedly legitimate companies are impersonated seeking from persons their details of credit cards or accounts with the intent to steal these details and commit fraud on your credit card or account.
• Identity Theft: Identity theft is a crime where an individual's personal information, for example, name, address, Social Security number, or financial details is stolen to open new credit card accounts, make purchases, or apply for loans in his name.
• CNP fraud: The Card-not-present fraud can happen with any transaction, particularly over the Internet or phone, where payment for products and services is made without the actual presentation of the card. Purchases or payments are made by using the details of a stolen card from someplace other than the residence of the cardholder, taking into consideration the platform for e-commerce or processing the payment.

Warning signs of credit card fraud you should know

• Unauthorized transactions on your credit card statement.
• Suspicious charges from unfamiliar merchants or locations.
• Messages, emails, or offers from unknow senders.
• Receipt of replacement cards or account statements that you did not request.
• Unusual account activity, like many failed login attempts or changes to account information without your consent.

Preventive measures against credit card fraud

• Do A Frequent Check On Your Accounts: It is ideal to look through your monthly statements and transaction activity online on credit card accounts to see if there are any unauthorized or suspicious charges. Notify your card issuer promptly of any such activity.
• Always keep your cards safe: Remember to never share details of the card, PINs, or passwords with anyone, even making the mistake of writing them down or saving the information in an insecure place.
• Use Secure Payment Methods: When buying stuff over the Internet, make use of the most secure methods of payment. It means visiting only reputable and credible sites that have, or are known, to have encoded their systems of payment.

Look for the small padlock icon at the start of the browser address bar, and make sure the URL of the site starts with "https://" to indicate a secured connection.

• Guard against phishing: Do not respond to any unsolicited email, text message, or call asking for any personal or financial details. Verify the authenticity of communications directly from the official contact details of the institution.

These pose great dangers to consumers and businesses, such as loss of finances, identity theft, and ruining good reputations. An understanding of the different scenarios in which these might fall under this type of fraudulent act and being proactive in protecting the information on the card will help consumers avoid becoming victims.

Therefore, PayCEC renews its commitment as a provider of reliable payment gateways to maintain the security of its users against credit card fraud in every online transaction. PayCEC is a secure processing service for credit card payments with the latest advanced fraud detection systems, encryption technology, and solid security protocols.

Go live with PayCEC today and enjoy all the peace of mind that comes from knowing you're dealing with transactions being processed by a provider that has all the necessary measures in place to protect them from fraud.