The Latest Trends in Making Credit Cards More Secure
We tend to think of credit card security from the consumer point-of-view. We want our information safe so criminals cannot use our card details to purchase goods without our permission. Most credit card companies do not hold cardholders liable for for fraudulent charges, but it is still inconvenient, especially if a fraudster makes a massive purchase and temporarily limits your credit line. Additionally, after you have reported the fraud, your credit card will be canceled, and you will have to wait for your card issuer to send you a new card.
Credit card companies are also motivated to end fraud because of the costs they incur. In 2015, fraud cost card issuers $15.72 billion. To protect consumers and their own interest, credit card companies are taking a number of steps to make their cards more secure.
1. Chip Technology
Chip cards have been in the United States for a few years, and you can expect them to keep expanding in the future. EMV chips are standard in Europe, but some retailers still allow customers to swipe to pay because of the expense involved in making the switch. However, fraud liability rests on the shoulders of retailers if they have outdated equipment, so you can expect the remaining updates to take place soon. Otherwise, if their payment system is hacked, the retailer will be responsible for the costs—not the card issuer.
Why the push for EMV chips? They are much more secure than magnetic strip transactions. When you pay by swiping a card with a magnetic strip, all of your credit card information is transmitted across the payment network. Thus, if someone hacks into the payment card system, which has happened at a number of major retailers, all of your payment card details will be taken. However, EMV chips complete transactions using a dynamic payment code. So if the system is hacked, the thieves will only receive a useless code–not all of your card details.
2. Mobile Wallets
Another trend that is securing credit card information is the move to mobile wallets. There are a number of mobile wallets available such as Apple Pay, Chase Pay, Google Pay and Samsung Pay. Like EMV chip cards, mobile wallet payments are more secure because transactions are completed using a dynamic payment token instead of credit card details. In fact, once a mobile wallet is set up, your bank information and credit card details are not stored on your phone or transferred over a payment system. Even if someone steals your mobile device, they will not be able to access your credit card details.
3. Tracking Options
Credit card companies are also making it easier to monitor your transactions. Most banks and card issuers offer a mobile app from which you can monitor transactions or set up alerts. This way, you will discover fraud instantaneously and be able to more quickly report it to your card company. Additionally, many card issuers are giving customers free access to their credit score. How can this keep your credit card safer? If you notice an unexpected drop in your score, this could be a flag that someone is fraudulently using your identity. You can request a copy of your credit report to see what is amiss and more quickly report any inaccurate information.
Another tracking device offered by credit card companies is dark web monitoring. The dark web is a place where criminals sell credit card and personal information, among other things. If your card company offers dark web tracking, you will be able to see if an illegal entity has access to your accounts, social security number or other online accounts, and take steps to secure your information.