Credit card fraud is a serious matter. It can cost banks millions of pounds every year. And, it is a hassle for consumers every day. So, if there is credit card that provides extra security, you’d sign up immediately, right?
Well, Oberthur Technologies has created such a card, and they are in talks with UK banks to bring the technology to you.
How the Card Works
The new credit card technology provides the same function to consumers with which they are familiar. There is a standard magnetic strip along with the chip technology. The part that makes it more secure is how the three digit code on the back of the card is rendered.
Instead of having a particular three digit code printed on the back, a small screen displays the code on the back of the card. The code is set to change regularly, such as once every hour. The process is supported by an imbedded battery that is designed to last three years. At that point, the card would be replaced.
Why it Offers More Security
Since the three-digit security code changes, stealing the three-digit code associated with the card provides little value to criminals. When the code changes, the previous code is no longer valid. This means that any transaction that requires the correct code to be entered to validate the charge will not go through with previous code.
Most online retailers require the three-digit code be provided to process an order. Entering an invalid code prevents the transaction from being approved, even if the rest of the information provided is correct. This means, if someone steals your credentials, such as with a skimmer or shimmers, they will be essentially useless within an hour.
The one downside about the changing security code is based in the fact that it changes. Many people memorize their credit card information. This allows them to enter information quickly without having to look at their card. Other websites allow card information to be save, preventing the need to re-enter the data with every purchase. The technology would likely make it more difficult to use “wallet” features in smartphones as well. None of these will be entirely possible with the new security code, or will at least require something to work differently.
This means that, every time a cardholder makes a purchase, they will have to physically have their card in-hand to do so. That way they can enter the correct security code at the time of the order. While this poses little innate risk, some say it is an inconvenience.
Is it Enough?
Will the changing security code end credit card fraud? No, it will not. There are a number of mechanisms in place that allow purchases without the code being entered. However, it should lessen the occurrence of credit card fraud, especially for fraudulent online purchases.
To help keep your information secure, especially when shopping online, it is important to have all of your security software up-to-date. You should also avoid shopping at stores you do not trust, only shop on secured sites, and regularly scan your computer for viruses. It is also imperative that you monitor your accounts for fraudulent activity. That way, you can shut down the card and report the charges as quickly as possible.