Beware credit card skimming scams

2007-12-15 00:00

Christmas is the season to be scammed according to banking gurus. They warn shoppers not to let credit cards out of their sight in case the confidential data on the magnetic stripes gets "skimmed" by fraudsters who then charge massive purchases to these cards.

Skimming involves copying confidential data using a device small enough to fit into the palm of your hand or into retailers’ legitimate processing machines. One swipe of a card and all the information stored on the magnetic stripe on the back is stored for sale to fraud syndicates.

Last year skimming fraudsters did card holders out of millions of rands.

Skimming will be brought under control only once new card technologies take hold in South Africa. EMV chip cards were introduced in Britain in 2004 and credit card fraud fell by almost a quarter the next year.

Absa began a slow roll-out in March. South Africa’s other major banks are following, but are not as keen to provide details

The roll-out is expected to cost the national banking sector about R1 billion, but it is not clear how long it will take to replace existing credit cards.

Walter Volker, general manager of Absa Group payment systems, says the roll-out could take between three and four years.

The new cards come with an embedded computer chip which stores information in a way that is virtually impossible to access and copy. Encryption technology authenticates the card.

The new card is inserted into a card slot held by the retailer. It stays there for the duration of a transaction. The card holder uses a PIN in much the same way as with a debit card

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