While credit cardholders can reap benefits from their cards, banks are continuing their efforts to improve security to protect customers.

Credit cards make shopping easy. Even without money in their wallets, for example, people can purchase anything they need, even expensive items.

'I would have to bring suitcases of money if I had to pay in cash because the items I bought were very expensive,' said young business executive Wahyu, who bought high-end branded audio equipment.

By using a credit card, he could pay for the equipment before or on the payment due date as he did not want to pay by installment. 'With the credit card, I can make transactions whenever I am abroad on business or on a holiday,' he added.

Bambang, another credit cardholder, has also reaps the benefit of having a credit card. It is especially useful, he said, when he is in urgent need of additional funds.

'A bank once offered me a loan without collateral, but having a credit card was a prerequisite,' he recollected.

Thanks to the credit, he managed to get a loan from a bank, which, he said, was a solution to financial constraints that he faced when he was building a house.

Wahyu, Bambang and many other credit cardholders may have had good experiences with credit cards, but they also need to be aware that credit card fraud is becoming more sophisticated.

Late last month, the Jakarta Police arrested an IT-savvy couple for credit card fraud on cards owned by foreigners.

'The couple is suspected of fraud on 35 credit cards, all owned by foreigners,' said Jakarta Police criminal investigations director general Com. Pol. Heru Pranoto.

He said that cases of credit card fraud were always eventually discovered and the culprits captured. 'It may relieve consumers [credit cardholders] to know this,' he said. But he warned that preventive measures were always best when it came to credit card fraud.

Basically, credit card-related fraud occurs when irresponsible individuals steal other's personal data, which is stored in a microchip imbedded in the card.

Therefore, cardholders should guard the safety of their cards.

'Consider your credit card like physical banknotes because somebody may violate the card if lost,' said Indonesia Credit Card Association general manager Steve Martha, adding: 'The worst experience facing customers are when they are charged for fictitious spending.'

Halo BCA manager Mahendra said cardholders should always keep three important things in mind: the card itself, their personal data and signature.

He said the most important data they should remember is their mother's maiden name and their card number.

'Never be careless with your card, and immediately report to the bank issuer if you lose it.'

While credit card fraud can occur, banks have put stringent measures in place to protect customers and minimize fraud. Banks and credit card companies take credit card fraud very seriously.

As a preventive measure, they apply sophisticated security systems and hire teams of fraud experts to monitor transactions, detect possible credit card fraud and protect customers. The systems, for instance, report unusual transactions on a customer's account and take steps to prevent fraud from occurring.

Bank Mandiri senior VP for consumer cards Boyke Yurista said that most banks had a fraud prevention department to avoid credit card fraud.

Bank Mandiri applies several risk parameters to monitor possible fraud and prevent it from happening.

'We have officers watching our customers' transactions. When they spot suspicious trends, they will alert the customer through a phone call,' he said.

Experts have warned that with electronic trade increasing, irresponsible individuals who are IT savvy also strive to take advantage of the trend. 'Credit cardholders who shop online and make electronic transactions using a credit card should stay alert,' he said.

Online shoppers might be attempted by the easy transaction aspect. 'For example, a transaction through Google Playstore is quite simple. A customer only need enter the set of numbers written on the credit card, then verify further by entering an email address and password,' he said.

However, he said, even though efforts to develop a security system to protect customer data during e-transactions have been made, it was not enough.

Many bank issuers are developing specific alert methods to prevent e-transaction fraud by sending text messages to customers.

'We text customers as notification whenever a transaction is made via the Internet,' said BCA credit card services head Nina Andayani.

That's why cardholders should inform the card issuer if they change their cell phone numbers, she added.

Boyke reminded, 'We also should keep our email address and password confidential.'

Six-digit PIN

In August, Bank Indonesia introduced the use of six-digit personal identification numbers (PIN) for transactions. Previously, a PIN was only applicable for cash withdrawals at ATMs and in Internet banking. Now, customers need to feed the electronic data capture (EDC) with their confidential number for every transaction. A signature is no longer considered enough for purchase authorization. 'The new requirement is aimed at improving safety measures to help protect credit cardholders,' Bank Indonesia communications department executive director Tirta Segara once said.

The regulations will come into effect on Jan. 1, 2015.

Under the new regulation, when making a purchase, cardholders need to enter a PIN and leave the card in the terminal (EDC) while the transaction is processed rather than swipe the card and sign a receipt.

These cards use a technology called cryptography that allows the card and the store terminal to communicate with each other during the transaction and to carry out security checks to ensure that the card is valid.

Currently, state-owned banks, such as Bank Mandiri and BNI, have already imposed the new regulation.

The respective banks have a specific page on their websites through which the banks request a customer's PIN when they make a transaction. With this new technology advancement, it is expected that credit cardholders will feel more secure and protected. (Eddy P Kasdiono)

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