Top 5 Places to Avoid Using or Swiping Your Debit Card
Plastic money – that was ground breaking and radical change in the humans used money. No cash and yet, every transaction involving money is completed successfully – that’s magical, isn’t it? Plastic money came in two formats – credit cards and debit cards. While the former is more like a short term personal loan, the second one utilizes the money in savings bank account. Plastic money has numerous benefits, some of which are:
- Eliminates the need for carrying cash and hence, eliminates the problem of theft or robbery.
- Transactions take place in a jiffy. Just one swipe and done! The problem of providing exact change is also eliminated.
- It is secure and allows encrypted transactions secured by an added layer of personal identification number.
- It is widely accepted my merchants at various points of sale or POS.
While debit cards have several benefits, there are some risks and disadvantages as well. They are given in a tabular format below:
|Uses disposable cash||Debit card uses disposable cash in the savings account. There is no credit feature associated with it.|
|Fees||Using debit cards at certain POSes may attract additional charges.|
|Also, using debit cards of one bank to withdraw cash from another bank’s ATM can also attract charges.|
|Electronic fraud||This is something one should be seriously concerned about. The number of cases of fake callers positioning themselves as bank personnel asking for debit card details and other details and pulling out money from accounts. Several high end technical devices are also used to get the details of debit cards like CVV number and PIN code to extract money from user accounts.|
So, now we know that debit cards have their own fair share of advantages and disadvantages. However, that’s not what we intend to learn in this article. We intend to find out the top 5 places where you shouldn’t be using or swiping your debit card because chance of theft will be high. You don’t really want to become a victim of electronic or cyber financial crime. Do you? So, let us begin!
Top 5 Places to Avoid Using or Swiping Your Debit Card
1. Making IVR Payments
You have most probably never heard of this or even if you have heard, you most probably don’t remember because it is not really a common phenomenon. IVR-based payments are really not common in India but the option exists. It is very risk and the option of finding out the truth or ingenuity of the call is very difficult.
Here is a case:
One of the readers once reported a loss of Rupees 75,000 because of this IVR payment and he was unable to recover the money. He was a victim of IVR fraud. What really happened?
Well, the person in question was an IT professional based in Gurgaon. He planned to travel and decided to share the same with his friends through social media. So, he gave details of his travel plan on the social media site. Soon, he received a call from a lady. That lady stated that she was calling on behalf of the airlines company with which this person decided to fly to his destination. She stated that the airlines company has received a call from the payment processing gateway and that the payment has not been successful.
The ticket price was nearly Rs. 6,000. The lady stated that he has two options. First option is to purchase a new ticket, which will cost him Rs. 9,500. The second option is to make an immediate IVR-based payment so that the ticket is not canceled.
This person was confused and worried because cancellation of the ticket would mean loss of a significant amount of money. Also, buying a new ticket will mean loss. He didn’t have enough choice and so, he agreed to what was being said. He decided to make a payment through the IVR system.
He was asked to provide his debit card number, CVV number as well as the expiry date. Then there was this need for OTP or one time password that bank sends for online transactions using debit cards. He received the OTP and used that too.
The story took a really sad turn after that… After a few hours, this person then received one message on his phone. It was notified to him from the bank that an amount of Rs. 75,000 has been debited from his account and that the money was spent on some foreign website for purchasing certain goods. The IP address of the website showed that it was from an African country
The question is, how did this all happen? It was possible by replicating an IVR call from a laptop or a desktop computer that was laced with keylogger software. Once the person entered the details, the keylogger software on the other end logged in the details. Since the OTP stays valid for 15 minutes, the fraudsters on the other end had 15 minutes to use the OTP. Within those 15 minutes the fraudsters managed to make purchases worth Rs. 75,000.
The problem was that though the transaction was being tracked by the Indian bank, nothing else could be done as the transaction took place outside of India. The money was totally lost!
How do you prevent such mishaps?
Well, IVR transactions are not really unsafe. They are actually safe as long as they are taking place through outgoing calls to the number that has been provided by the company. It may happen at times that network problems can lead to call drops in the middle of an IVR payment process and the customer trying to make a transaction may receive a call from customer support to help with the process of completing the payment. It is always wise to politely decline transactions over incoming calls and insist on making a payment through outgoing calls. This way you can be sure that you are actually calling on a genuine number provided on the company’s official website.
2. ATMs located in isolated places
You must have noticed that in order to improve their ATM services, banks are quick to install ATMs in as many locations as possible. Sometimes, in this rat race of expanding their networks, the banks end up installing ATMs in very isolated places where there is a possibility of development. Using debit cards in such ATMs is not advisable. Why not? There is no problem with the ATM itself. It is not rigged or anything. The problem is that the possibility of loots and thefts in those areas is significantly high. You may be looted after you take out money or you may be threatened and forced into taking out all cash and hand it over to the goons. So, avoid using your debit card at such ATMs.
3. Avoid White Label ATMs
What are white label ATMs? Well, they ATMs which are not owned by banks. In order to increase the penetration of ATMs in rural, semi-urban and urban areas, Reserve Bank of India allowed private companies to operate ATMs. These companies are not affiliated to banks and neither do they fall in the bank sector industry. They simply give the infrastructure through which banks can increase their reach to users. These white label ATMs accept debit cards of almost all banks. Now, RBI has very strict guidelines and not just any company can open ATMs at will. They need to be trustworthy and have a certain amount of liquid cash available to operate. However, there is one problem. What will happen in case of a dispute? For instance, you try to use a white label ATM and though the screen shows that transaction failed and no money is dispensed, the amount you try to withdraw is simply debited from your bank account. Who should you approach? The ATM company will send you to the bank and the bank will send you to the ATM company. No one will be ready to accept responsibility. You may end up losing your money. So, if you are using your debit card at white label ATMs, do so at your own risk.
4. Saving debit card details in online transactions
We are getting accustomed to online purchases. It saves time, gives the comfort of home and helps us get lazy too! Well, have you ever noticed that there are many website (e-commerce) websites out there that ask for saving your debit card details. For example, they will either require you to save card details before you can make a payment or they will simply save the details without asking for your consent. When that happens, your debit card details get stored in a server that is not owned by the bank that issued the debit card in the first place. So, what if a hacker manages to breach that server? He or she will have complete access to your debit card details. You have a fair idea of what will happen next. So, if a website is asking you to save your debit card details, you should try to steer clear of those websites. Better to be safe than to be sorry once you lose your money. Such instances have happened in the past and such instances can happen again.
5. Retail outlets and small stores
There is an ever increasing trend of retail outlets and small stores accepting cards (debit cards or credit cards) for payments. For example, you can find this option in many medical shops. There is a risk factor here. The POS machines used in these outlets can literally have electronic system installed in them in such a way that can steal information of the debit card once it is swiped. This is called debit card skimming. Incidences like these are on the rise and things become dicey when cards are swiped multiple times because payments keep failing. It is highly likely that the failed instances were actually the times when the card was skimmed for information.
This skimming takes place from the magnetic strip. This magnetic strip is where all the information is stored electronically and it is easy to steal information from magnetic strips found on cards. To counter this problem, RBI has come up with a mandate wherein magnetic strips will now be replaced with what is known as EMV Chip and a PIN. This will make stealing information much more difficult compared to magnetic strips. These new cards will be introduced in India by end of December 2018. All banks operational in India will have to comply to this RBI mandate and banks that do not comply will be fined and punished by RBI.
So, if you are still using your debit card which has a magnetic strip, it is time that you get it replaced before you walk up to a small store or a retail outlet and swipe it to make payments for your purchases. It is better to be safe than to be sorry, right?
Conclusion: The bottom line is that, if you are not on your toes all the time with your money, you may find yourself duped at any moment. Elder people who are not very comfortable with debit cards most often become victims of such organized crimes. Imagine what will happen if your debit card information is stolen and the money is used for any illegal purchases like drugs or firearms or anything like that! You will be totally screwed at least until the law enforcement finds the truth through proper investigation.
Thus, it is absolutely necessary that you keep your money safe and try to avoid these places while using or swiping your debit card. After all, losing your hard earned money and having your identity stolen will only push you into troubles that will wreak havoc on your personal and professional lives. If you really want to avoid that from happening, play safe!