Security problems and
solutions for credit cards
The credit card security relies on the physical security of
the plastic card as well as the privacy of the credit card number. Therefore,
whenever a person other than the card owner has access to the card or its
number, security is potentially compromised. Once, merchants would often accept
credit card numbers with out additional verification for mail order purchases. Its
now common practice to only ship to confirmed addresses as a security measure
to minimize fraudulent purchases.
Some merchants will accept a credit card number for in-store
purchase, whereupon access to the number allows easy fraud, but many require
the card it self to be present, and require a signature. A lost or stolen card
can be cancelled, and if this is done quickly will greatly limit the fraud that
can take place in this way.
The PCI DSS is the security standard issued by the payment
card industry security standards council. This data security standard is used
by acquiring banks to impose card holder data security measures upon their merchants.
Internet fraud may be by claiming a chargeback which is not
justified or carried out by the use of credit card information which can be
stolen in many ways, the simplest being
copying information from retailars, either online or offline. Despite efforts
to improve security for remote purchases using credit cards, security breaches
are usually the result of poor practice by merchants.
Controlled payment
numbers
Disposable credit cards which are used by various banks such
as virtual account numbers, discover
secure online account numbers, five banks using ecarte bleue.
Profits and losses
In recent times, credit card portfolios have been very
profitable for banks, largely due to the booming economy of the late 1990s.
however, in the case of credit cards, such high returns go hand with risk,
since the business is essentially one of making unsecured or uncollaralized and
thus dependent on borrowers not to default in large numbers
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