The Reserve Bank of India issued a notification in January 2020 on enhancing security on card transactions. This requires cards to be active only for domestic PoS and ATM transactions, at the time of issuance. The cards should by default, be deactivated for international and online transactions. Banks should give the facility to card holders to activate international and online transactions as and when required by them, through internet banking, mobile banking or IVR channel. Banks have to also enable ‘switch-on/switch-off’ and limit setting facilities on cards. Now cardholders can ‘switch-off’ their card when they are not using it. They can also set limits for different types of transactions they intend to do, using their card. All card issuing banks have already introduced these features.
This measure gives a security lock in the hands of the card holder to protect the card from any misuse. The RBI, through its ‘RBI Kehta Hai’ series, should create awareness of this feature to the general public. Banks should also publicize these features. They should educate card holders on the exact steps to be taken, to activate these features. Will this measure bring down the overall number of card frauds in India? I sure hope it will!
There were 57.17 million credit cards and 835.34 million debit cards in the country as on June 1, 2020. As usage of card increases, frauds on these cards are also increasing. According to a RTI query reply given by RBI, between April 2017 and September 2019, a total of 1,10,367 cases amounting to Rs. 371.44 crore were reported.
As a card holder, one should know what type of frauds can happen on cards and what precautions need to be taken. Please click on this link to see the RBI circular which explains your duties and potential liabilities in case you are hit with a card fraud. Let us look at the type of frauds that are likely in each step of a card life-cycle. I have given the details in the form of an info-graphic, for easy readability. Any comments, suggestions are welcome!
Why is plastic card required at all? Why can’t there be only electronic card activated in a mobile app? Why can’t e-card be mandatory, and any other form of card optional? We understand not everyone may have a mobile phone. But that situation was several years ago. Now everyone has a mobile phone.
Hi Radha, appreciate very insightful article served with rich information on the specific Care needs to be exercised while using credit cards. Switch Off / Switch On feature is not known widely amongst the users so thank you for sharing on this blog. Info-graphic is nicely explained and will be really useful for credit card users as some of the info presented are not very known to general public. Whether physical cards or digital transaction, one needs to be ultra vigilant to use this technology. Once again this article deserves great appreciation for giving exhaustive information on use of credit card. Thank you and looking forward for more such deeply researched articles.
Hi Ninad, I am glad you liked my article. The intention was to make people aware of this feature so that they use the same regularly. Thanks so much for the appreciation and encouragement.
Good and informative article.. No doubt credit card can be very useful in managing your expenditure but one has to be very wary of fraudsters waiting for a chance to swindle. If one follows the precautions deligently as mentioned in your article then credit card frauds can be averted to a great extent.
Most of the time one gets swayed by fear and greed in sharing valuable information on the phone.
Looking forward to more articles from you..
Thank you for your comments. Banks and RBI need to create more awareness of the preventive measure and safety features on cards. My blog was a small endeavor towards creating awareness in the minds of the readers. Please do forward my blog to your customers and friends, who you think, need the awareness.