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Meanwhile when you are going through the Bills and Expenses of your Debit or Credit card statement and suddently you get shocked by a jolty number stating that you have shopped at X Store for Rs. 14979

But the problem is, you haven’t made such kind of transaction. Then you worry about where the money gone?

That suspecious transaction could be the indication you have been made a victim of credit card fraud.

Credit card fraud happens when someone — The fraudster or a thief — uses your debit or credit card stolen from you or the information from that card to make unauthorized purchases in your name or take out cash advances using your card details.

This is the kind of Fraud which is called as Debit or Credit Card Fraud or simply a Card Fraud.

Now a days in India many innocent public became a victim of this fraud.

Credit card fraud is not rare, and it could happen with you too. This is why it is very much important to take the steps necessary to help prevent it.

How much frauds happen in the world every day, how much are card frauds among them.

In this article you are going to learn what are the,

Prevention against Debit or Credit Card Fraud

Hello Money Enthusiasts,

I am very happy to see you reading such an important article on preventing Debit or Credit Card Fraud.

Before proceeding to the actual prevention and countermeasures over the Card Fraud we must have to learn about various methods by which fraud can happen.

Statistics by experian shows that 1 out of 4 customers are a victim of online fraud. Click this picture to read more in details.

Credit Card Fraud - Arable Life

How online payment Transaction Works?

Credit Card Fraud - Arable Life
Online Payment Transaction | Source : TwisPay

To make the online payment transaction possible, Shop owner have to previously set up an internet merchant account (IMA) and a payment gateway. Here how precisely all it plays out when customer hits that final button on shop’s checkout session:

  1. Customer provides her payment information (debit or credit card details) and smashes the Buy Now button for her liked product
  2. The payment gateway picks up online payment transaction information such as 16 Digit Card Number, Expiry and 3 Digit CVV (Card Verification Value) and then takes it to the second page for OTP (One Time Password). When the customer enters its OTP in time then it is considered as approved and authenticated then with encryption it will take it to process the payment
  3. The payment processor passes the payment information along to the relevant card network – For Example Mastercard, Maestro or Visa
  4. The card network performs a check with the issuing bank (the bank that issued Card to the Customer) whether customer’s transaction can be authenticated. If everything checks out at this stage, the online payment transaction is authorised and customer’s card is immediately debited by the issuing bank;
  5. The issuing bank sends a confirmation of the payment authorization to the card network, thus letting Mastercard/Visa/etc. know that the customer has been authorized to complete an online transactions. By the way, this is when the issuing bank also informs to customer that her card is being debited
  6. The card network (Mastercard/Visa/etc) further confirms the validity of the online payment transaction to the payment processor and the payment gateway
  7. The payment gateway delivers the good news to the merchant and Shop is now free to inform to customer that her wonderful product is on its way. 

All this process happens in less than three seconds, just less than three seconds. All these Six separate entities communicate efficiently, quickly, and safely, in seven separate stages, in less than three seconds, while at the same time more than thousands of such other online payment transactions are completed every single second. Accurately.


There is little drawback in this system with some POS (Point Of Sale). Especially with the international payment gateways.

Som e-commerce sites or systems do not required to enter OTP for processing the payment.

That means when you enter Card Number, Expiry and CVV and hit pay button then you will notified by the back itself about debit of your money.

This is very risky when your card get stolen.

Credit Card Fraud - Arable Life

There are many types of card Fraud you yet to learn. Here are those.

8 Different Types of Card Frauds

  1. Lost or stolen cards, is a common one which we have discussed above
  2. “Account takeover” — when a cardholder unwittingly gives personal information (such as home address, mother’s maiden name, etc.) to a fraudster, who then contacts the cardholder’s bank, reports a lost card and change of address, and obtains a new card in the soon-to-be victim’s name.
  3. Counterfeit cards — when a card is “cloned” from another and then used to make purchases. In Asia Pacific, about 10% to 15% of fraud results from malpractices such as card skimming but this number has significantly dropped from what it was a couple of years prior, largely due to the many safety features put in place for payment cards, such as EMV chip.
  4. “Never received” — when a new or replacement card is stolen from the email, never reaching its rightful owner.
  5. Fraudulent application— when a fraudster uses another person’s name and information to apply for and obtain a credit card.
  6. “Multiple imprint”— when a single transaction is recorded multiple times on old-fashioned credit card imprint machines known as “knuckle busters”.
  7. Collusive merchants — when merchant employees work with fraudsters to defraud banks.
  8. Email order/telephone order (MO/TO) fraud, which now includes e-commerce, and is the largest category of total payment card fraud in Asia-Pacific, amounting to nearly three-quarters of all fraud cases. The payments industry is working tirelessly to improve card verification and security programs to prevent fraud in so-called “card-not-present” transactions online or via email order and telephone transactions.
  9. Phone Fraud which is widely practiced in India, Telecaller Fraudster call you by telling you that he is a bank’s authorised officer and take your confidence and then try to manupulate your emotions by intimidating with several reasons that your card is going to block today. If you take certain action then you can prevent it from blocking or reactivating it. Then you will share all the card related details including OTP. Then within a second your account will be debited with huge transaction amount. Then you will have no choice than repent on your mistake. This type of fraud is technically called as Social Engineering which manupulate human psychology and emotionally vulnerable.
Credit Card Fraud - Arable Life

Different ways to prevent various kinds of Debit or Credit card frauds

  1. If you can not find your Debit / Credit Card then quickly call to your bank’s emergecy number to repost lost of your card. There might be possibility of stolen or misplacement of your card. If you get the same then you can unblock/reactivate the same card or order new one. You can minimize your possibile damages through it.
  2. If you notice that any suspecious transaction made on your account then report it to your bank and raise/lodge a complaint against refund of those. It is possible that after investigation you will get the money back to you. (Many people get refunded by the banks)
  3. Never ever give your any kind of information over call. Though someone is convincing to you that they are bank’s authority or officer. The information including
    • Card Details – Card Number, Expiry, CVV and OTP
    • Address – Do not provide address details unless you call the bank’s correct number and they have such kind of verification system otherwise never share this information
  4. Always check your accounts of money inflow and outflow. And make sure that all the numbers are correct. If you have incurred any charges or transactions you have doubt then quickly call to the bank and inquire about that. Keep in mind, minor difference in amount can make a lot of difference.
  5. While making transaction on POS or ATM, make sure you type by covering keypad with another hand and none is eavesdropping (meaning : secretly watching what number you type). Even check the position of CCTV installed in ATM. Because you never know who is watching your secret number through the Camera.
  6. Before inserting your card at ATM make sure that no other similar machine is installed above the place of Card Receipt area. If you don’t know that might be a skimmer machine which takes your card’s information and sends it to the fraudster.
Credit Card Fraud - Arable Life
Skimmer Machine
Credit Card Fraud - Arable Life

So Friends,

Here we conclude the information about the Credit Card Frauds.

Hope you understood how the online payment system works, what are the practices made by fraudsters for doing Credit Card Fraud and what are the ways through which we can prevent these types of attacks on us and making us victim of them.

Credit Card Fraud - Arable Life