Online credit card payments " how safe is your money?
Recent headlines in the newspapers have painted a dark portrait of personal details being either stolen, discarded in rubbish bins by banks or cleverly extracted by criminal masterminds, all using the Internet as a means of getting hold of your personal banking details. Credit card transactions on the Internet have never been higher, as the high street sales crash and online sales rocket. So how safe are your details when using a credit card online?
Despite the terrifying headlines of identity theft and credit card fraud, its actually quite safe to use your credit card to make purchases online, as long as you follow a few basic rules. There are plenty of precautions you can take to protect yourself and your credit card against the Internet scammers or even genuine businesses that find themselves victims of the current economic downturn and collapse before your transaction is completed. Even some of the biggest companies are at risk, as the dramatic collapse of XL Leisure, Britains third largest tour operator, so clearly demonstrated last year. So it pays to pause for a moment and make a couple of checks before you type in your details and press the 'enter button.
Ironically enough, the first tip is " always use a credit card rather than a debit card. The Consumer Credit Act 1974 Section 75 states that if something does go wrong with a transaction the credit card company is jointly and severally liable with the retailer. This covers transactions from 100 up to a maximum of 30,000 and gives consumers some peace of mind. If a company does go out of business before youve received your goods then you can claim the amount back from the card provider. A recent court ruling has also determined that purchases from overseas companies are also covered, which is particularly reassuring for online customers. However, these regulations may not be applicable if you have made your purchase through PayPal or other similar payment systems. Debit card transactions do not have this protection and are at far more risk.
Check if your credit card offers an Internet guarantee. It means that you will be covered against the cost of fraudulent online activities, although the exact terms and conditions may vary from card to card. Card providers that do not offer Internet guarantees may instead offer a dispute procedure. This means that if you cannot recover your money back from the company, a liquidator (in the case of a company going into administration) or another third party then you may be able to take the case to arbitration and recover your funds that way.
Check your computer itself before (and after) buying online. If you do not have up-to-date anti-virus software and a firewall installed then your computer is vulnerable to spyware, which can lift your details from your computer by counting the keystrokes when installing passwords or sensitive financial information. If an email asks you to confirm your details by clicking on a link, there is a very high probability that it is a phishing email, designed to part the unwary from their details. The first you will know about it is when your bank account or credit card is magically emptied, so never give your details out. Your bank will not ask you to confirm details except by direct contact, so any email (even if it appears to come from your provider) that does ask for this information is a scam. It goes without saying that all passwords should be kept secure, but dont make the common mistake of having the same password for all your Internet functions. Once that password becomes common knowledge, your entire system (including your credit card details) are vulnerable.
When using a credit card online, look for two indicators that you are using a secure site. The first is the inclusion of the letter s in the URL address (a secure site will start with the prefix https) and the second is a padlock icon in the browser frame of your screen. If either of these are missing, the site is not secure and your details are vulnerable. Check the company you are buying from, ensuring that they have a real address and telephone number and not just a cyber-address. By following a few guidelines and being aware that the responsibility for your financial security is down to you, using a credit card online can be both safe and easy to do.
Despite the terrifying headlines of identity theft and credit card fraud, its actually quite safe to use your credit card to make purchases online, as long as you follow a few basic rules. There are plenty of precautions you can take to protect yourself and your credit card against the Internet scammers or even genuine businesses that find themselves victims of the current economic downturn and collapse before your transaction is completed. Even some of the biggest companies are at risk, as the dramatic collapse of XL Leisure, Britains third largest tour operator, so clearly demonstrated last year. So it pays to pause for a moment and make a couple of checks before you type in your details and press the 'enter button.
Ironically enough, the first tip is " always use a credit card rather than a debit card. The Consumer Credit Act 1974 Section 75 states that if something does go wrong with a transaction the credit card company is jointly and severally liable with the retailer. This covers transactions from 100 up to a maximum of 30,000 and gives consumers some peace of mind. If a company does go out of business before youve received your goods then you can claim the amount back from the card provider. A recent court ruling has also determined that purchases from overseas companies are also covered, which is particularly reassuring for online customers. However, these regulations may not be applicable if you have made your purchase through PayPal or other similar payment systems. Debit card transactions do not have this protection and are at far more risk.
Check if your credit card offers an Internet guarantee. It means that you will be covered against the cost of fraudulent online activities, although the exact terms and conditions may vary from card to card. Card providers that do not offer Internet guarantees may instead offer a dispute procedure. This means that if you cannot recover your money back from the company, a liquidator (in the case of a company going into administration) or another third party then you may be able to take the case to arbitration and recover your funds that way.
Check your computer itself before (and after) buying online. If you do not have up-to-date anti-virus software and a firewall installed then your computer is vulnerable to spyware, which can lift your details from your computer by counting the keystrokes when installing passwords or sensitive financial information. If an email asks you to confirm your details by clicking on a link, there is a very high probability that it is a phishing email, designed to part the unwary from their details. The first you will know about it is when your bank account or credit card is magically emptied, so never give your details out. Your bank will not ask you to confirm details except by direct contact, so any email (even if it appears to come from your provider) that does ask for this information is a scam. It goes without saying that all passwords should be kept secure, but dont make the common mistake of having the same password for all your Internet functions. Once that password becomes common knowledge, your entire system (including your credit card details) are vulnerable.
When using a credit card online, look for two indicators that you are using a secure site. The first is the inclusion of the letter s in the URL address (a secure site will start with the prefix https) and the second is a padlock icon in the browser frame of your screen. If either of these are missing, the site is not secure and your details are vulnerable. Check the company you are buying from, ensuring that they have a real address and telephone number and not just a cyber-address. By following a few guidelines and being aware that the responsibility for your financial security is down to you, using a credit card online can be both safe and easy to do.
About the Author:
Henry Jones is a financial writer that likes to bring forward issues and information within the financial market. You can find further information on credit cards online here.
posted by Debt Consolidation Loan at
7:58 AM
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