Mumbai, 12 March 2020
by Satakshi Chopra
The concept of e-commerce evolved to bridge the gap between online businesses and its customers and providing them with the convenience and ease of indulging into purchases. Unluckily, even the online payment platform comes with its own shortcomings. With digital payments constantly evolving and flourishing, the cyber-criminal activities are sprouting too. But what is an online payment fraud?
An online fraud is an illegal or false transaction made against an individual’s credit card or bank account on a website or webstore. To commit a fraud, the impostor doesn’t require the actual physical card of an individual. Cloning and thieving sensitive pre-saved card information are how most online payment frauds are committed.
According to a report published by Nielsen in 2015 and 2016, worldwide card fraud has increased every year since 1993; has increased immensely since 2010 and will keep increasing until 2019.
A significant growth in card fraud has been marked in 2010 and can clearly be manifested to the growth in the e-Commerce field during the same period.
Online payment frauds are most rampant in today’s technologically enabled world where digital transactions comprise most of our purchasing activities. It is impossible to abstain from undergoing online transactions, however, eliminating the potential risks that come with it, can be done.
What are the most common Online Payment Frauds and how can you avoid falling for one?
With large amounts of card information stored and transferred online on a daily basis, it has become quite convenient for the hackers to get their hands on your card details. Most of the online payment fraud takes place in three ways- Losing or being robbed of merchandise that you’ve paid for, Unauthorized transactions and false demands for a refund.
Let’s take a closer look.
1. Phishing or Spoofing: When phishing, the fraudsters try to access your personal information by targeting you with deceitful or suspicious emails or websites claiming to be legitimate, asking you to share your crucial bank and card details.
What you can do: Do not provide your personal details to any website that doesn’t look reliable. Before performing a transaction and sharing your banking information, be 100 per cent sure of the recipient and the website.
2. Data Theft: Dishonest employees take advantage and misuse the employing business’ card information and other data. Data theft includes credit card fraud, refund fraud etc.
What you can do: Websites that do not adhere to stringent data security norms pose a threat to your personal data and card information. Try to avoid making transactions on websites that look fishy or don’t follow standard security protocols.
3. Fake schemes: Fraudsters often try to lure people by offering heavy discounts on illegitimate products asking them to share their card or banking information.
What you can do: Don’t fall for offers and schemes that sound too lucrative to be true. Always be sure to verify the company and its offerings before you fall prey to impostors.
4. Identity Theft: In case of identity theft, the imposter obtains key details of the individual’s personal information and uses them for fraudulent purchases online.
What you can do: Do not share your card or crucial banking information with anyone via the website, phone call or email who may misuse your information. Be sure of how your payment information is being stored and used.
5. Clean Fraud: Fraudsters make use of actual data of an individual to commit cybercrimes. Hackers going for clean fraud generally hold a lot of information about the cardholder and his credit card.
What you can do: Never make payment through a website that is not PCI DSS compliant. PCI compliance protects and maintains a certain level of security for your card transactions. Also, avoid storing your PIN and passwords on the website which doesn’t follow security protocols.
Fraudulent activities may vary depending on the sales channel used, and the fact that most merchants are targeting multi-channels for sales is not making the situation any easier.While it is challenging to eliminate the threat of a fraud completely,continuously updating your network security system may help ensure that your sensitive business and customer’s information is secure.