Most of you own credit cards and have been using them for a while. Depending on your financial strength you must be having a credit limit of few thousand to few lakhs. The cards typically have a 16 digit number and a 3 digit CVV number and are extremely susceptible to misuse, both online and offline. If a card is lost, the person who finds it can go on shopping without slightest hesitation. If someone can note your CC number and CVV he/she can shop online, the card is also vulnerable to magnetic card readers using which miscreants dupe people. There’s hardly any fool proof control for me as a user to prevent misuse of my card. In this post, I wish to present a set of simple measures, if banks can incorporate, would make credit cards far more safer and reliable.
1. Let users set their limit. Assume my card has a limit of Rs 1 lakh. Probability of me shopping for Rs 1 lakh at once is extremely low. I spend very little, not more than few thousands at a time. So why should I carry a liability of Rs 1 Lakh with me? Can’t the banks give users an option to set their immediately available limit on their credit card. If I have total limit of Rs 1 Lakh, I may wish to set an intermittent limit of Rs 10000. This way, at any point of time, maximum risk/liability I carry will be confined to Rs 10k. In special occasions when I feel the need for higher limit (while buying expensive items/travelling abroad etc) I should be able to login to my credit card account and increase the limit.
2. Don’t print CVV on back of the card. Why is CVV printed on back of the card so that anyone who gets the card can use it for online purchases? I believe customers can afford to remember the CVV or PIN number. Let them store it in their mind and there should be a provision for me to change the CVV/PIN if I fear it has been compromised. This way, if a card is stolen, its online usage will be restricted.
3. Make entering PIN mandatory for offline usage too… The pin shouldn’t be stored on the card (magnetically) and should be retrieved from the bank network for verification. This way, if someone copies card data through a magnetic card reader he won’t be able to use it, without knowing the PIN.
4. Bring in biometric readers-Register the fingerprints of card holders-let them swipe their fingers while using the card. This is a fool proof way to prevent unauthorized usage.
What do you think? Am I wrong anywhere? Is there any technical inhibitions to provide above features? Do you have better ideas? Your thoughts please.