Although credit and debit cards are more convenient and safer than cash, you still have to be vigilant to protect your card from criminals.
According to FNB Credit Card CEO Jan Kleynhans, there are more than four-million FNB credit and debit cards in circulation in South Africa. Of these, about 10 000 credit cards are reported lost or stolen every month. There has been a 50% increase in fraud on these lost and stolen cards in the past six months, which could be a result of the dramatic increase in smash-and-grab robberies.
Kleynhans says this steep increase in the fraudulent use of stolen or lost cards is a concern as customers are often not reporting the loss in time. When a client’s purse or wallet is stolen, victims are traumatised and are more likely to forget to cancel their bank cards.
‘There is a lot to deal with when you have been the victim of a crime — but remember that cancelling your bank cards as soon as possible remains an important task, which will limit the gains the criminal will make from his actions,” he says.
Criminals are also using more sophisticated mechanisms to obtain credit card information. Skimming, for instance, is when the information from your card is copied using a small device that fits into the criminal’s pocket. Restaurants are one of the highest risks for this type of fraud and FNB recommends that you never let your credit or debit card out of your sight.
‘A recent incident investigated by the bank revealed that a card skimming operation in a restaurant was directly linked to drug crimes. In this case, the manager was involved in skimming cards and was receiving illegal narcotics as payment. The syndicate behind the credit card fraud was also involved in drug dealing,” says Kleynhans.
Security tips to protect your card:
l Never disclose your PIN (secret number) to anybody. Memorise it and keep it safe as this is the key to the money in your account.
l Never allow your debit or credit card to be taken from your sight. You have the right to be present when a merchant swipes your card through an electronic terminal. Fraudsters can use small, hand-held card reading devices to capture the electronic data encoded on your card. They can later use this information to produce a counterfeit card. So be alert when you pay by debit or credit card.
l Never accept help from strangers when using an ATM and always be wary of strangers asking for help.
l When destroying old credit or debit cards, always cut through the magnetic stripe, twice horizontally and twice vertically.
l Always sign the back of your card as soon as you receive it, using a ballpoint pen.
l Report a lost or stolen card to your bank immediately.
l Always review your monthly statements and report any unauthorised debits immediately.
l Ensure that you always get your own card back after transacting.
l Never leave your wallet or handbag unattended as the details of your cards can quickly be copied (or skimmed) and the cards returned without your knowledge.
Insurance tip
When taking out insurance on your car, opt for a flat excess, says Keith Kennedy, Executive General Manager of Claims at Mutual & Federal.
An insurance excess on your insurance policy means that you pay for a certain amount of the repairs, should you be involved in an accident. From the insurer’s point of view, it discourages small or frivolous claims while fostering a sense of driving responsibility — and you win by reducing your monthly premiums.
Previously, insurance companies would only offer an excess as a percentage of the total repair costs. This means that, should you have an accident, you would be liable, for example, for the first 5% of the damages. If you are involved in a bumper bashing and the bill is R2 000, you would only have to pay R100 and the remainder would be covered by your insurer. But, if your accident is more serious and the panel-beating bill comes to R40 000, you would have to pay R2 000.
Now you can opt for a flat excess, which is a predetermined cash figure irrespective of the repair costs. So, if you have an excess of R1 000, you would have to pay in R1 000 for the bumper bashing, but would also only pay R1 000 for a more expensive repair. In this way, you can avoid nasty surprises. The best way to manage your excess is to keep the R1 000 in an account in case of emergencies.
‘For peace of mind, a no-surprise solution is preferred. However, consumers should be aware that flat excesses can change across different categories of risk. The flat excess for retired persons or for drivers under the age of 25 may be different to that of the average driver. In cases of doubt, a broker should be consulted,” says Kennedy. — Maya Fisher-French