What Payment Methods Can Help Prevent Credit Fraud?

Staying aware of the changing landscape of payment options provides consumers with safer ways to make purchases as credit fraud becomes more sophisticated and challenging to detect. Adopting new payment methods allows you to take control and feel more confident in a technological landscape. Protect your Florida credit report from fraud by adopting safer ways of payment for online and in-person purchases. 

Contactless Payment

Paying a merchant, family member, or friend has never been simpler. Contactless payments can be completed with certain credit cards or through mobile payment apps on a smartphone. How do these methods work, and why are they so safe? 

Mobile Payment

Many smartphone platforms provide a digital wallet, allowing users to link a credit card or banking information for contactless payments. When you shop in a store, the information stored in your digital wallet is used as a payment method when you tap or scan your smartphone on the payment reader at the register. Additionally, mobile payments may be made when you shop online. For example, we’ll use Apple Pay.

Paying through a mobile payment app allows the encrypted payment transactions to be detected through the app on your phone, and then the transaction is re-encrypted with information that only the payment reader or website has access to. When shopping online, a website must verify its domain each time a mobile payment app is offered as a payment option. Mobile payments are unique because your bank account information is never transmitted to the store, keeping your personal banking information more secure than ever while completing financial transactions in Florida in person or online.

No payment platform is 100% risk-free. However, mobile payment vendors realize that technologically educated generations are embracing their services and the security they provide. Safety is paramount to their users who embrace a more straightforward way of paying while making everyday transactions, traveling across the world, or transferring money to a friend. Always verify you are sending money to the right person if you pay an individual. 

EMV Chip Cards

Many credit cards now come with a tiny silver or gold microchip, creating a one-time use digitally encrypted transaction ID to make a payment. EMV chip cards create a new digital code that is unique to the purchase you are making. Unique codes for each purchase make it more challenging for criminals looking to steal your personal information. 

Using a credit card with an EMV chip also keeps you safer from fraudulent devices, such as credit card skimmers used to read the magnetic stripe on some credit cards. In some stores, tapping the card on the reader allows for a simpler form of payment. Remember that when using these cards in businesses without chip readers, such as some restaurants where servers still swipe your card, you can still make payments via the magnetic strip on the back but lose the protection provided by the EMV chip. 

Magnetic Stripe Cards

There was a time when magnetic stripe cards were the only credit card payment option available. This revolutionary payment option allowed for your information to be encoded into the stripe on the back of a credit card. When you swipe it, the machine reads your data, like playing music on a cassette tape, where the player reads and transmits music. The downside to using this type of card now is that scammers have developed magnetic stripe readers, known as skimmers and mentioned above, that can be placed over the readers of a legitimate business, such as a gas station, reading your personal banking information and putting your credit at risk of credit fraud.

Cash

More businesses and entities are turning away from cash payments to protect funds coming in from employee theft and cutting down on the handling time and deposits that must be made by employees. When possible, use cash for smaller purchases to protect against credit fraud. It is virtually untraceable to any personal information specific to your credit or identity.

Avoid These Less Secure Payment Methods

Many businesses offer discounts for debit card purchases because they pay less in fees for these transactions. Additionally, debit cards pose less of a risk of loss to businesses. However, most debit cards ask for a personal identification number (PIN) to be entered to complete a transaction. Avoid using debit cards at these businesses in Florida to protect your credit and against financial loss:

• Gas stations
• Retail stores, when possible
• Restaurants and bars, especially when opening a bar tab
• Tourist locations in Florida, particularly when buying tickets to a theme park or events
• Florida pop-up events and festivals
• Online

Liability for an unauthorized transaction through a debit card may cost up to $500 instead of the $50 you may pay with the unauthorized use of a credit card. Federal protections for credit cards differ from those offered to debit cards. Using a credit card may not be foolproof, but using a credit card can prevent high fees for consumers targeted by fraudulent activity. Report the incident immediately if your debit card is hit with a fraudulent charge. Failing to report the scam purchase on a debit card within two days may result in the highest fees and penalties. 

Checks

Many individuals still feel comfortable with writing checks because it allows them to track spending receipts in one location while balancing a checkbook in one place. However, notice the numbers along the bottom of your check and your personal contact information in the upper lefthand corner. You instantly become aware that your credit can easily be compromised when a check falls into the wrong hands. When a check is stolen or misused, you have handed over your contact information, routing number, and account number to your bank. Reserve using checks for as few transactions as possible.

Protecting against credit fraud is something to remain diligent about every day. Using safer payment methods allows some piece of mind. Immediately contact your financial institution if you notice unauthorized purchases. Reach out to a Florida credit card fraud attorney for protection from significant instances of credit fraud.