Making card transactions goes more secure in Future

When we swipe our card at shopping malls and restaurants or use it at the ATM to withdraw cash and pay utility bills, we are under the constant threat of our cards being counterfeited. Besides, if you lose your card, someone can misuse the time lag, between your losing and blocking the card, to swipe and imitate your signature at the point of sale (POS).

• What you can do

This mandate implies that more banks would come out with chip-based cards and they would look at including more customers, rather than offering it to a select category.
State Bank of India, for example, since mid–2011, offers EMV chip credit card to almost all its new customers.
If you are an existing SBI Card customer, check with the bank. You could be entitled to a chip card on renewal.
Besides, the RBI has also said that by June 30, 2013, banks must issue EMV chip and PIN-based credit/debit cards to customers who have made at least one purchase using their debit/credit card in a foreign location.
Three, if you are a customer of a bank that currently issues chip cards, visit your branch. If you have a credit card with dated credit limits or a higher average balance which entitles you to a debit card with enhanced features, you may be eligible for an upgrade to a chip card.
Going by the guidelines, the infrastructure is expected to catch up quickly too. In fact the working group report (May 2011) mentions that about 90 per cent of the POS terminals are already chip-ready.
Says Dhruv Shah, Product Manager, Electracard Services, “While EMV-supporting ATMs are not yet available in India, switches, which drive the transaction processing at ATMs, are already geared to support EMV transactions.”
Moreover, as EMV adoption rates vary worldwide, none of the issuers give you cards that are only chip-based.
All chip cards contain the magnetic stripe at the back. So, while an EMV-compliant machine will use the chip, a non-EMV machine can still process your transaction using the magnetic stripe.
That way, at least some of your transactions will be more secure.
Plastic money has made life much easier for all of us. But unless we have had a personal experience, we don't realize how much of a security nightmare it can be. Here are a few things that will make our card transactions more secure.

• Chip cards reduce risk

Both these risks can be reduced to a great extent if you use cards that are ‘chip' based rather than ‘magnetic stripe' based and cards that require a PIN to be entered at POS terminals.
Unlike magnetic stripe cards, chip cards (also called EMV cards) use superior technology that helps guard against skimming and cloning. PIN requirement at POS terminals brings in a second layer of authentication, making misuse of stolen cards difficult.

Best way to simplify credit card usage

Ajay has to first deal with the question of whether he needs multiple credit cards and, if so, how many. Having more than one card is useful when a large payment has to be made or when a particular card cannot be used.
Ideally, the cards should have different affiliations, such as MasterCard and Visa. It is also a good idea for Ajay to dedicate one card for official use, so that there is no confusion while claiming reimbursement for payments.
Since his job involves a lot of travelling, using a co-branded card that is linked to an airline will help him in official use as he can get credit for usage. Two cards for personal use and one for work-related expenses should be enough for his needs.
While reducing the number of cards, Ajay should consider retaining older cards with a good credit history since they are likely to have a positive impact on his credit score. The other factors he needs to consider include the acceptance of the card, authorised limits, billing cycles and costs associated.
The cards that he should first consider closing are those that are linked to (DJ H Jawani 2) stores or products since they add very little value and may even encourage spending.
Ajay should also set up an online payment process for his card, so that he is able to pay his bills from his bank account using the Internet or mobile banking services. Several online services enable paying bills on time, which Ajay should make use of. He should set in place a system to keep track of the expenses charged, the payment and dates of payments.
Having a place to keep credit card slips will make it easy to access them for checking against card statements. He should sign up for online/mobile reminders of due dates, online statements and payment facility. These are things that Ajay can do to continue enjoying credit facilities in an efficient manner.