Getting into the unfortunate situation of losing or getting your wallet stolen can be heartbreaking. Later finding out that your credit cards have been illegally used by the thief can pour more salt in the wound. Getting a call from your creditor alerting you to fraudulent activity can be be a joyless conversation to have.
BankRate reported that two out of four Americans with credit cards have been the victims of some sort of credit or debt fraud within the last five years. There is no one magical card that will prevent fraud, but these two cards come with a form of security that can help prevent fraud.
One of the most common credit cards is the one with a magnetic stripe on the back. The magnetic stripe on the back is the security measure for the card. This stripe encompasses three tracks that carry all the information on the card. This information consists of your name, card number and expiration date. The first two stripes carry this information, but the third stripe, which is sparingly used, can include a country code, identification number or an authorized amount the card is allowed to give out.
All the information is encrypted so it will be difficult for thieves to access your personal information. Many of these cards also come with CVC codes which also aid in your prevention of fraud online.
EMV chip card
Although these types of cards are mainly used abroad, they are available from several major credit card companies. These cards come with a microprocessor chip that stores specific account information and interacts with the computer when you are using it at checkout. The chip encrypts each purchase uniquely in order to prevent fraud.
This type of card comes with two options in order to combat fraud, a chip-and-PIN and chip-and-signature option. The chip-and-PIN requires you to enter a pin for every transaction, and the latter needs a signature for every purchase. Many credit providers advertise different EMV card offers, so investigate and see which option is best for you.
There is no one credit card that can prevent identity theft or credit card fraud. A consumer will need to do their best in order to be safe when making purchases or paying bills, but these are two options that can help the process.