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osing a credit card is a serious problem, it can cause a huge financial loss that is easily avoidable.

Banks do not issue credit cards to us out of benevolence. Both the banks and the shopkeepers benefit by their usage. Banks get a percentage from shopkeepers.

The interest of the banks is clearly seen from the hordes of young men who aggressively sell these cards in every mall and from frequent calls one gets from girls offering us credit cards on behalf of banks and other institutions.

Shopkeepers get a bigger volume of business. Banks or organizations that issue the credit cards (VISA or Mastercard, etc.) can take the following simple steps to avoid misuse of stolen credit cards.

The issuing bank can introduce a PIN (password) for all credit card transactions as is common with debit cards. A similar PIN system also exists for cash withdrawals using credit cards. If this was introduced for credit transactions in shops, etc., nobody except the rightful owner could use the cards.

Banks can introduce some sort of insurance scheme so that for a small premium, the loss due through fraudulent use can be limited.

The credit card should have a user’s photograph so that fraudulent users can easily be detected.

On the part of the shopkeeper, it should be compulsory to ask for and check the ID of the user e.g. KTP (ID card), KITAS, etc. whenever the amount is bigger than say Rp 1 million (US$111).

The signature of the fraudulent user should be checked against the signature of the rightful owner of the card. After all, even today, when we pay cash, the tellers check bank notes and refuse to accept them if torn, etc. At many places they even use ultraviolet light to check the authenticity of currency notes.

In other words, shopkeepers are very particular about accepting bank notes but not when credit card transactions are involved and they rarely match the signatures. This is because at present nobody except the rightful owner of the credit card has any responsibility for the transactions.

The users of the credit card are customers of the banks and the shops where goods are bought. But both of them have scant interest in us as customers. The promptness with which these banks charge us interest and penalties even for a day’s delay in sending payments is never shown in taking care of our interests.

They wash their hands of us! The shopkeepers selling goods get paid whether the transaction is genuine or fraudulent. So only the rightful owner of the card suffers.

Banks should not regard losing a credit card like losing one’s wallet. Most of us never carry more than Rp 1 million or Rp 2 million on us, but a lost credit card could be worth a loss of say 50 million rupiah! So serious thinking is needed.

When the banks benefit, why can’t they work to improve the safety of their cards? When shopkeepers are happy with increased sales volume, why can’t they be forced to take extra responsibility?

Otherwise, people who pay their dues on time have no advantage in using credit cards. They are better off with a debit card!
K B Kale
Jakarta