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Credit card becoming more secured than cash

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There are numerous benefits that consumers can reap by simply using credit cards, whether in actual retail establishments or shopping online.

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In this age of technological convenience, the use of paper currency for transactions has become less and less pervasive. Purchases using credit cards have taken a growing per­centage of the norm, mainly because of the handiness, accesibility, and added features that go with it.

There are numerous benefits that con­sumers can reap by simply using credit cards, whether in actual retail establishments or shopping online.

On top of increasingly attractive rewards programs, several credit card providers offer different enticements such as cash rebates, price protection features, return guarantees, extended product warranties, and other con­sumer protection add-ons.

Credit card benefits are no longer limited to the standard redeemable points for catalog items. New benefits that have become part of credit card plans offer additional value or greater protection, which can be especially useful when purchasing premium items.

Various credit cards also offer a return guarantee for customers that may find them­selves unsatisfied with their purchases. Under the condition that the claim requirements are met with a certain period since the purchase date (regardless of store policy), card holders are entitled to a refund.

In the case of many electronics and high-end devices such as computers, the manu­facturer’s warranty normally only lasts for a month (or up to one year) when purchased with cash.

Remarkably, some credit cards offer extended product warranties without incurring additional charges.
Other credit cards also offer purchase protection plans against theft or damage, an extremely beneficial perk for handheld gadgets such as mobile phones and tablets.

Meanwhile, as the Christmas season brings unavoidable expenses, the consumer are also urged to take extra care in using their credit cards during this peak month.

Using a credit card for holiday shopping is truly a practical and convenient choice, but cardholders need to be smart and safe.

For those with multiple credit cards, it is advisable to take only one or two of them, as the incidence of theft during the holidays is higher.

Likewise, cardholders are being discour­aged to practice lending out credit cards, espe­cially to children or friends, because once it’s out of your hands, it’s out of your control.

Meanwhile, with the introduction and migration of banks to more secure chip-based cards, fraud incidence has saw some decline.

Earlier, the banks have shifted to Europay MasterCard Visa (EMV) chip-enabled cards that provided more layers of protection for cardholders’ information against hackers.

EMV chip card transactions improved security against fraud compared to magnetic stripe card transactions that rely on the hold­er’s signature and visual inspection of the card to check for features such as hologram.

Countries, including the Philippines, that have fully moved to EMV based technology have seen significant decrease in skimming fraud losses.

Compared with the traditional magnetic stripe technology, EMV, a global standard for interoperation of integrated circuit cards, has provided additional layers of security, includ­ing a unique digital seal or signature that is encrypted in every chip-enabled card.

This unique digital seal or signature allows to easily detecting if the card is genuine even in an offline environment, thus preventing crimi­nals from transacting any fraudulent payment card at any given time.

An EMV card, likewise, has a unique au­thentication process that protects cardholder’s data, which make them more difficult to be cop­ied by any unscrupulous individual, or cloned and skimmed by international syndicates.

EMV chip technology made counterfeit fraud much more difficult for two reasons.

Firstly, the chip itself is highly secured, which makes reproducing the data on it very difficult and expensive. Secondly, using the data stored on the chip, the card uses powerful authentication methods to authenticate itself.

EMV chip-enabled cards are also sup­ported by an enhanced cardholder verification method, through the use of Personal Identifica­tion Numbers (PIN), which is not commonly available on magnetic stripe cards.

Currently, PIN for the traditional credit cards can only be implemented when terminals are fully online-capable. However, rolling out such transport infrastructure is too expensive and complicated for several markets, including the Philippines.

But with EMV’s secure data storage ca­pabilities, the personal PIN of the cardholder can now be stored on the chip, which enables transaction verification to be performed in an online or even offline environment.

PIN verification on credit cards is a major advantage and an effective solution to lost and stolen and card-not-received fraud. EMV chip-enabled cards also store considerably more information than magnetic stripe card.

But despite the meticulous safeguards that EMV has put in place, the best defense of card­holders against unscrupulous individuals is to keep their credit card details to themselves, such as personal identification number, credit ceiling, credit balances among others.CSL)

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