Inconveniant? Perhaps, but it`s safe
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HSBC is introducing new technology which will check every credit card transaction for fraud. The scheme will affect 10 million card accounts and millions of transactions. However, the banking industry has warned that more legitimate transactions will be queried or cancelled as a result.
But action needs to be taken. Card fraud is rising, up 14% in the first half of 2008, and fraud abroad now accounts for 40% of all card crime
Travellers are being advised to take several different payment methods, including cash, credit cards and travellers’ cheques when they go abroad.
After several years of falling numbers, card fraud started rising again in 2007. Latest figures show that card fraud could have exceeded £600m in 2008, and banks are using increasingly sophisticated systems to try to outwit fraudsters.
HSBC previously checked 25% of card transactions but is currently rolling out a system that means all card transactions will be screened in real time, with a decision made in a fraction of a second.
SAS UK, which is providing the software system for HSBC, say on their website, ´when you put your card in the machine it’s carrying out an automatic check against your pattern of normal use and making a decision about whether that is real or fraudulent.`
Banks are constantly battling with fraudsters to reduce the levels of crime. Card fraud is an arms race. The banks will come up with one way of dealing with it, the fraudsters will come up with a way round it.
The prime example is what we have seen with chip and pin. It was successful for 18 months, two years, but then the fraudsters have worked a way round it, so companies are now looking at more sophisticated means
However as the banks become more proactive in targeting fraudsters, more people could find their legitimate transactions are declined or queried.
Customers using their cards abroad are most likely to experience problems meaning that the first days of holidays are spent on the phone with banks rather than relaxing. If customers have relied on one means of payment the experience can be very stressfull indeed
Spending large amounts of money or using your card frequently can similarlay trigger the alarm at the bank.
As a recent victim of this type of crime (and also a very frequent traveller) I welcome this intiative. I arrived in Riga a few months ago and tried to draw some Lats out of a bank machine where my card was blocked. Then within minutes the fraud department at Barclays rang me up and established that it was me using my card an unblocked it
The simple fact is that the level of security we demand from the banks is so high that occassiaonlly we will inconveniance ourselves. However, limiting the accesss we have to our money briefly for security reasons is infinitely preferable to finding our money has vanished into the pockets of fraudsters.
