Providing guarantee against fraud

Plastic today is considered to be more convenient, easy and fashionable alternative as compared to paper. Yes, we are talking of credit cards. With one swipe, credit cards have changed the way we live.

Unfortunately, along with the convenience has come related crime. Credit Card Fraud is a weighty problem in the credit card industry. Though many technologies have evolved to check and prevent these credit card frauds, it still persists and comes forward with new faces every time.

The issue

Credit card fraud continues still despite invention of new technologies. The fraudsters get access to the information of the card mostly through loss of credit cards from its owner. Theft of credit cards is also a frequent phenomenon.

Many a times emails ask for the credit card details posing as the service provider for the credit card. This act of phishing gives the required information to the thieves in doing credit card fraud.

Many a times people visit bogus websites and in the way give them the details of their credit card which also lead to credit card fraud.

Many credit card holders are not serious about their possession and see the PIN code in public place. If any person gets this information then he could access the credit through the credit card which is known as skimming.

The offer

To help their customers deal with credit card frauds, some of the banks have come up with certain beneficial policies.

The first step towards proving a guarantee against credit card fraud was taken by Standard Chartered and Tata AIG General Insurance Company Ltd, and since then the trend has caught on.

Their Plus Extended Protection Plan solves the problem of an individual’s responsibility for late realisation of her/his credit card loss. Earlier if you would have lost your card or say someone would have stolen it and you failed to report, you had to pay for the delay in reporting.

This service has not only identified this problem, but solved it altogether. Now, a credit card customer is insured against any expenditure on his lost credit card made12 hours prior to reporting the loss.

The insurance cover reimburses (up to Rs 50,000) per fraudulent transaction up to 12 hours prior to the customer reporting the loss to the bank. Also, the bank has extended this cover to all debit and credit cards.

Similarly, even ABN Amro Bank offers this cover with a total coverage of Rs 2,000-Rs 5,000 at a monthly premium of Rs 100.

In case of SBI Cards, the credit card company caps the liability to a maximum of Rs 1,000 for non-gold cards once it receives a proper notification of the loss by the customer. The gold card customers enjoy zero liability once they notify the bank authorities.

HDFC bank offers an insurance cover, which covers the customer from fraudulent transactions for up to 24 hours. Moreover, the cover comes free of cost. But you have to also file an FIR to hedge against these frauds.