10 Essential Tips to Protect Your Credit Card from Frauds

A credit card has become a popular choice for individuals as a payment method, as it provides a convenient way to access short-term credit and enhances the purchasing ability of the cardholder. In comparison to using a debit card or cash, credit cards offer increased safety, convenience, and rewards. By taking advantage of attractive rewards, cash-back points, and discounts provided by credit cards, prudent usage can lead to significant monthly savings. The utilisation of credit cards has seen a rise during the pandemic due to people preferring online shopping to avoid crowded public areas. However, this increased usage has also resulted in a higher occurrence of credit card fraud targeting technophobe individuals. Being aware of potential credit card fraud and implementing preventive measures can enable you to use your credit cards securely. This article provides 10 tips to protect your credit card from fraud.

10 Tips to Protect Your Credit Card from Frauds:

1. Beware of different credit card frauds and scams:

Fraudsters and scammers can make credit card frauds/scams by accessing your sensitive information. They can gain access to your sensitive information, such as your personal details, credit card number, CVV, One Time Password (OTP), etc., in several ways, due to which your credit card can easily fall prey to unauthorised activity. Here are some commonly used techniques by fraudsters and scammers to carry out credit card frauds/scams:

• Physical theft or loss of your credit card

• Skimming your credit card information using Point of Sale (POS) devices

• Phishing attempts to deceive you into revealing your credit card details

• Malware attacks targeting your credit card information

• Theft of your email credentials to gain access to your credit card details

• Stealing physical documents containing your credit card information

• Observing your actions at the checkout counter to capture your credit card details

2. Keep the credit card safe:

In order to avoid credit card fraud, you must ensure that your credit cards are stored in a secure location. Make sure to check that the new credit card kit or envelope has not been tampered with, and promptly sign the back of the card upon receiving it. Always keep the credit card securely stored in a compact wallet, making it challenging for thieves or pickpockets to access. After each purchase, promptly stow the card away to minimise the risk of thieves capturing a digital imprint of the credit card through snapshots using cell phone cameras. It is also advisable to periodically verify the presence of the credit card in your wallet, even if you have not used it for some time.

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3. Never share your sensitive information with anyone:

It is crucial to prioritise the confidentiality of your financial information and take measures to protect it. One fundamental practice in safeguarding your credit card security is to never share sensitive details such as your credit card Personal Identification Numbers (PINs), mobile application passwords, or internet banking passwords with anyone. This rule applies regardless of whether it is a close friend, family member, or even someone claiming to be from your bank. Sharing such information can leave your credit card vulnerable to unauthorised access and fraudulent activities. Always remember that legitimate financial institutions will never request such information through email or any other insecure channels. By strictly adhering to this principle of not sharing sensitive credentials, you can significantly reduce the risk of falling victim to identity theft, fraudulent transactions, or unauthorised access to your financial accounts.

4. Keep an eye on your credit card account:

Most credit card issuers provide the convenience of monitoring your credit card transactions through various means, such as SMS and email alerts, internet banking, and mobile apps. These alerts offer real-time updates, enabling you to closely monitor your credit card expenses. By activating these alerts, you can receive immediate notifications whenever a transaction occurs on your credit card, allowing you to track your credit card spending effectively and ensuring that you are aware of any unauthorised/suspicious activities. Monitoring your credit card transactions through these alerts adds an extra layer of security and empowers you to take prompt action in case of any fraudulent or unauthorised charges. It provides peace of mind and enhances your control over your credit card usage, helping you stay on top of your financial transactions.

5. Do not save your information on random websites:

Trusted and established platforms like Google Pay and PayPal offer secure payment gateways and have stringent measures in place to protect your sensitive information. Hence, relying on such reputable payment portals for storing your card number is generally considered acceptable. However, an even safer practice is to avoid checking the "remember card details" option on any site or portal, regardless of its reputation. By refraining from selecting this option, you minimise the chances of your credit card information being stored on multiple platforms, thereby reducing the potential attack surface for hackers. Instead, manually enter your card details each time you make a transaction, ensuring greater control over the storage and transmission of your sensitive financial information. This simple precaution can significantly enhance the security of your credit card data and reduce the risk of it being compromised or misused.

6. Ensure the security of online transactions:

Ensuring the website's security before making any online transaction is another crucial step to ensure the security of credit cards. You can verify the website's security measures and authenticity by looking for indicators that indicate a secure connection, such as an "s" after the "http" in the website address, signifying that it is using the HTTPS protocol. Moreover, check for a lock icon in the browser's address bar, which indicates that the website has a valid SSL certificate and provides a secure encrypted connection. These security features help protect your credit card details from fraudsters/scammers. By confirming the site's security and authenticity before entering your credit card information, you can minimise the risk of falling victim to online scams, identity theft, or unauthorised access to your financial data.

7. Do not pay upfront:

In the digital age, online scams have become increasingly prevalent, and it is crucial to stay vigilant and informed to protect yourself from falling victim to fraudulent schemes. One common type of scam involves receiving unsolicited emails that claim you have won a substantial prize, inheritance, or investment opportunity but require you to pay taxes or fees upfront to collect the funds. Such emails are part of online scams designed to deceive and defraud unsuspecting individuals. Under no circumstances should you make any upfront payments for such schemes, as they are simply a ploy to steal your money and potentially gain access to your credit card details for further fraudulent activities. Remember that legitimate organisations and authorities will never ask you to pay fees or taxes in advance to claim winnings or funds. Therefore, make sure you exercise caution, delete these emails, and avoid responding or providing any personal or financial information. By staying informed and being aware of such scams, you can protect yourself from financial loss and prevent your credit card details from falling into the wrong hands.

8. Don't fall for discounts on immediate payments:

We live in the world of advertising, where it is common to come across enticing offers that prompt you to "pay now" to secure a discount. However, it is essential to approach such deals cautiously and resist the pressure to make an immediate payment. Instead, take the time to evaluate the advertised product or service thoroughly, consider the pros and cons, and assess the legitimacy of the website or platform offering the deal. Rushing into a payment without proper research and consideration can leave you vulnerable to fraudulent schemes or subpar products/services. It is crucial to verify the credibility of the website/seller before making any financial commitments. Look for customer reviews, check if the website has secure payment options, and ensure there are clear terms and conditions for refunds or returns. By taking a moment to assess the situation and consider all relevant factors, you can make an informed decision, protect your financial interests, and avoid potential scams or unsatisfactory purchases.

9. Use different cards for different purposes:

A practical approach to managing your credit cards is to keep a separate card exclusively for autopayments, such as website subscriptions, telephone bills, or electricity bills. By doing so, you can safeguard this specific card from being swiped or handled by multiple individuals at restaurants, retail stores, or fuel stations. By limiting the use of this card solely for automated payments, you minimise the chances of it being exposed to potential fraudulent activities during day-to-day transactions. In the unfortunate event of card theft or loss, having a separate credit card dedicated to autopayments ensures that your essential bills are not disrupted while you wait to receive a replacement card. This practice provides an added layer of security and peace of mind, enabling you to continue meeting your financial obligations without undue inconvenience or financial penalties.

10. Set payment limit on your credit cards:

Credit card providers offer the convenience of setting payment limits for various types of transactions, including cash withdrawals, point-of-sale (PoS) transactions, e-commerce payments, international payments, and contactless payments. These limits are usually set to the maximum available amount on the card by default. However, it is best to customise these settings to align with your specific needs and preferences for day-to-day transactions. By setting lower limits, you exercise greater control over your credit card usage and minimise the potential financial impact in case of any unauthorised transactions or fraudulent activities. Adjusting these limits to the minimum amount necessary for your regular expenses provides an extra layer of security and helps prevent any excessive spending or potential loss in case of a compromised card. Most credit card providers allow you to conveniently change the limits through their mobile applications, giving you the flexibility to adapt the settings according to your evolving requirements. Taking advantage of this feature empowers you to proactively manage your credit card usage, enhance security, and maintain better control over your financial transactions.

To culminate:

In this digital world, safeguarding your credit cards from frauds and scams has become challenging as fraudsters/scammers often come up with new ways to trick credit card users. By implementing these 10 tips, you can significantly reduce the risk of falling victim to credit card fraud. By taking these proactive measures, you can enjoy the convenience and benefits of credit cards while ensuring your financial information remains secure.

KETKI JADHAV is a Content Writer at PersonalFN since August 2021. She is an MBA (Finance) and has over seven years of experience in Retail Banking. Ketki specialises in covering articles around banking, insurance, personal finance, and mutual funds and has been doing it for over three years now.

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Disclaimer: This article is for information purposes only and is not meant to influence your investment decisions. It should not be treated as a mutual fund recommendation or advice to make an investment decision.