Increased Security by Using Credit Cards with Online Payments
Indians have a tendency to be suspicious and wary, especially when it comes to online shopping and entering their credit card details to purchase goods or service over the internet. Being suspicious can be a good and bad thing, that is to say being careful when making a purchase on line is a good thing but one shouldn’t let a healthy level of suspicion turn into outright fear which prevents you from going about your business online, because you are too afraid you might become a victim of fraud or theft. Using your credit card online gives you the same rights as discussed in my previous post on the benefits of using a credit card as you would receive were you making a physical purchase. If there is fraud or you do not receive the goods or services you purchased the card company will have to chargeback to your account. For you as a consumer, you get the same benefits with the same minimal risk when you use a credit card online as you do when you use it in a store.
In India, credit card issuers make a provision in their contract with the client that they, the company, would not be liable for the fraudulent transaction unless the client loses their card and reports the loss immediately. Sometimes the banks and credit card companies try to avoid liability by inserting a clause in the relevant contract. This is purported to absolve the company in case a fraud occurs on the stolen card and the client fails to notify the loss in time. This unilateral provision however has not stood the test of legal scrutiny. The courts have placed the burden of loss squarely on the issuers.
Basic rules that you should follow when using your card online.
Whenever possible use your own computer or one that you are in control of. If you are going to use a shared computer like at home for example, then you should be aware of whom the other users are.
The vast majority of time spent on the internet in India though is done through internet cafes, and though most merchants have good security mechanisms in place and legally credit card companies must indemnify you against fraud, using your credit card on a computer in an internet café is a complete faux pas. You don’t know how the network is configured who has access to it, what they are looking at and whether malware has been installed on the computer you are using specifically to defraud you. Never do this, it is unsafe.
If you are using a shared computer though and you have or wish to engage in online shopping, then you should take some basic precautions.
- Delete your history and clear your cache. If you are using internet explorer you can do this by using the tools menu, select internet options, and click on the delete cookies and delete temporary internet files buttons.
- If you want to go a step further, clear the history as well, though that may cause problems between you and the owner of the computer.
- For Firefox it’s a little simpler, use the tools menu and select the clear private data option and it’s done in one step.
Shopping Online Security - A Brief History
The World Wide Web started back in 1990, and by 1994 the first shops started to appear on the internet, back then, less than a million people had access to the web and there was latent psychological mistrust amongst the online community and few people engaged in online shopping.
To counter this banks or card issuers, and merchants have had to implement sophisticated security systems in order to attract shoppers. Encryption technology for secure transmission of credit card information over the Internet and the standards and business relationships with credit card companies and banks are now in place that makes it all work smoothly. 15 years on and over a billion and half internet users later, the technology is well established now and there really is nothing to fear.
In the event your account does get hacked, and someone misuses your card there is legal recourse even if the banks fail to explicitly guarantee this. Remember though that contracts are one sided in this country and you will have to take legal action if the bank fails to chargeback in the event of fraud. In India, credit card fraud is mostly limited to the physical space anyway. Online con jobs make up just about 1% of the total numbers here, unlike 40% in the developed world. But, as consumers graduate to the shop-easy internet and pay with their cards, instances of fraud are bound to rise.
Whilst statistics are not available, as access to the web increases, reported cases of card fraud are estimated to rise at 20-30 % every year. So whilst being afraid is excessive, there is nothing wrong with a healthy dose of caution and most importantly common sense, in fact life is a lot more better for it.