With the use of debit cards instead of cash increasing, there have been a number of issues around debit card fraud, ATM skimming and contactless chip readers in the news. Fraud and security is always going to be an issue when it comes to dealing with money; whether it’s in the real world or online and whether using cash or electronic payments. That means it makes sense to be alert to what types of fraud can happen and how, and to understand whether or not you’re protected when using your debit card.
What to look out for
When using a credit card or debit card there are some signs to watch out for whether you’re using the card in-store or online.
A really common way that fraudsters will try to access your account details or steal your identity is by setting up a scam website and sending e-mails that look like an official organisation sent them. These can be very obvious and show a lot of signs that something is not right, but some can look authentic. Common signs to look for include:
- Correct spelling and grammar throughout. Professional organisations use spellcheck or send e-mails from an automated template that has been checked.
- No reference to your proper name.
- E-mail from your bank or finance provider asks you to provide account details or card number in reply. A real bank or financial institution will not do this; they already have your information and should only need to verify your identity.
- Inadequate or incomplete e-mail signature. A proper e-mail signature should have a phone, e-mail and mobile contact and the physical address of the sender should be obvious. The e-mail address should also be logical for the type of company e-mailing you and nothing outrageous or strange.
- Another issue is phishing, where you are directed to an identical looking page to your own bank or some other organisation and asked to provide your details as you normally would if you were with the real website. This can be almost impossible to detect until it’s too late, but in any transaction you should check for a properly identifiable business name and address, including an ABN and full contact details.
Whatever type of card you have – a debit card or credit card, any ATM can potentially be compromised by thieves. When going to use an ATM, you should make sure no one is too close to you to read your pin number, and do your best to cover the keypad when entering it. You should also pay attention when inserting your card. Does the card take an unusually long time to go in the slot? Does the fixture look like it could have been tampered with in any way?
NFC chip readers
Australians seem to be more and more comfortable with contactless payments, opening up the way for NFC chip readers to interfere with transactions and divert money to fraudsters.
Since contactless payments have arrived, there have been reports of devices that can read an NFC chip when it is within a certain range (just 10-20 centimetres in some cases). Readers can be carried by a person, or installed on a merchant’s card terminal.
While this technology does exist, and the threat of attack is real, there have not been mass reports of NFC chip fraud so far (though the risk could increase as more and more use the technology). Those businesses where contactless technology is used most, including the major supermarkets, will also be on the lookout for any suspicious activity and have it in their best interest to protect consumers while using their facilities too.
When it comes to online transactions, many debit cards will offer the protection usually offered by Visa or MasterCard (depending which one you use), but they may still be restricted if the funds have already left your account when the fraud is committed (see below for more).
How to report fraud?
Reporting fraud is easy, contact your bank or financial institution immediately if you suspect fraud has been committed during one of your transactions. You can use the customer service number or look up the number to report fraud (which should also be available when you login to your internet banking screen).
In most cases it is not appropriate to call the police first, because the bank can put an immediate stop on your card and in some cases (with credit cards too) may be able to stop the transaction going ahead if it is not too late. After you contact the bank you can speak to the police, or any relevant authorities.
If you want to learn more about fraud and consumers’ reaction to it, please read ‘Fraud Fear: Does the Media Affect Your Debit Card Use?’
Getting your money back
If a suspicious transaction has occurred, you’ll probably be interested in getting your money back. This is different when fraud has been committed on a debit card, because the credit card companies have their own systems in place for dealing with fraud, and can act more quickly in most cases. Your bank may need to investigate any incident thoroughly before giving you money back, and this can take weeks depending on how complicated the issue is, what type of fraud has been committed and how early it was reported. Here are the basic steps most banks outline, but each may have some differences so check with your own bank if you’re concerned about how it would deal with a fraud report.
- Report the incident to the bank immediately
- Fill out any forms necessary for the bank to investigate
- Destroy your card if you still have it and wait for the new one to arrive
- Await the results of the bank’s investigation
The reason for the wait is that with a debit card transaction the money is most likely instantly taken from your account, so the bank has a harder time dealing with the fraud. With a credit card there may be time to prevent the funds being transferred on to the party that committed the fraud. Credit card transactions can also come with rewards points and insurance for purchases too, although some debit cards may now offer limited purchase insurance but this is still not standard.
Is tap and go technology secure?
Apart from the risks mentioned above, tap and go technology is relatively secure. It is also a form of payment where you do not have to hand over your card to a third party, and you do not need to sign or enter a pin that someone might see if the transaction value $100 or less.
Managing your debit card using a mobile app
When you use your debit card, you can easily access the latest transactions, and make payments or transfer money, using your bank’s mobile app. This is a fast, convenient way to deal with your banking on the run, and most mobile banking apps are easy to use and just as secure as other forms of banking.
You will usually need to set up payees and BPAY billers within your internet banking before you can make payments to them using the app, but payments to accounts with the same bank can appear instantly.
What can you do with your debit card on your mobile app?
Your bank’s mobile app should show you the latest transactions on your account, making it easy to see what you recently purchased. You should also get a running total of your available balance when you login.
Make payments and transfers
Mobile banking apps mostly allow you to make payments to any Australian bank account when you have the details, including those already registered in your list of payees via online banking or as BPAY billers. Many banks allow you to pay directly to someone’s mobile phone.
Click to call the bank
You can often click to call your bank from inside your mobile banking app; this would also help if you wanted to stop a transaction or report an incident or to query a transaction on your account.
Many mobile banking apps may have different features and layout, and they will only get more sophisticated and user-friendly, so it is a good way to manage the basic aspects of your debit card account.