The world loves credit cards
People worldwide, have replaced the cash in their wallets with credit cards. In the cashless world of today, most of our purchases are made using a credit or a debit card. Convenience being the biggest factor behind using cards, the risks involved in being swipe-happy shouldn’t be ignored.
What are the risks?
Apart from the card being misused when it is stolen or not received in the mail, using your card at high-risk avenues can pose the following risks:
- Skimming of cards: Skimming is the crime of getting private information about somebody else’s credit card used in an otherwise normal transaction.
- Phishing: Scammers may use a variety of schemes to lure victims into giving them their card information through tricks such as websites pretending to be of a bank or payment system. Telephone phishing can also be employed, in which a call center is a setup to pretend to be associated with a banking organization. This can eventually lead to identity theft.
- Repeat billing: When a cardholder buys something from a vendor and expects the card to be charged only once, a vendor may charge the card a small amount multiple times at infrequent intervals such as monthly or annually until the card expires.
There are many such threats which need to be guarded against. Most of these can be averted by NOT using your credit card at certain places.
Unsecured shopping websites
Remember seeing a green lock icon (without overlays) on the site’s URL? That is a sign of a secured website. Yes, we know it is obvious but most of us are guilty of not paying enough attention to this basic hygiene aspect. However, this is not a foolproof method. Avoid redirecting URLs. Also, some websites try to copy popular shopping sites in order to lure unsuspecting victims. Always take a look at the URL in your browser. If the name shown on the site doesn’t match the name in URL, there is a very good chance the site is a hoax. Type the address of the website you want to visit manually in the address bar and research a bit before you type your card details.
Yes, it is still pretty functional and doing good business. Most users have opted out of buying products from teleshopping (advertisements placed on television or by a cold call) due to the apprehensiveness of the quality of products. However, the possibility of a scam company posing as a seller is always lurking around the corner. If you give your credit card details to the wrong company, you may become a victim of identity theft.
You are off for a coveted vacation or on a business trip. You are in the local market and find something for your spouse. You get floored by the hospitality and decide to buy it. Out comes your wallet and the credit card.
WAIT!!! The charges associated with using your credit card internationally are steep. Also, many credit card fraud experts warn travelers about the chances of card skimmers targeting them.
Urgent need of cash
Apart from avoiding high-risk places of using your credit card, another area that you need to curb your instincts is cash withdrawal. Most credit cards have the option of withdrawing cash, albeit for a steep fee. Unless it is an emergency, avoid withdrawing cash using your credit card.
Owning a credit card is a responsibility. If used right, it can be a powerful financial tool. Change your credit card pin and passwords regularly and review your credit card statements from time to time. In case you observe an anomaly, report it to the bank immediately. Due diligence exercised before using your credit card can help save a lot of trouble.