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Executive Summary:

Growth in the electronic payments sector has surpassed general economic growth and growth in other financial sectors. Electronic payments include credit, debit, and other electronic instruments used to transfer payments from consumers to merchants. A credit card is an instrument which provides instantaneous credit facilities to its holder to avail a variety of goods and services at the merchant outlet. It is made of plastic and hence popularly called as plastic money. This paper elaborates about the timeline for innovation for credit cards, the modus operandi of credit card. It further analyses the credit card frauds and measures to detect and prevent them. Electronic banking does not mean only 24- hours access to cash through an Automated Teller Machine (ATM) or Direct Deposit of pay checks into checking or savings accounts as many consumers may think. Electronic banking (e-banking) involves many different types of transactions; it is a form of banking where funds are transferred through an exchange of electronic signals between financial institution, rather than exchange of cash, cheque or other negotiable instruments. With the expansion of global Information and Communication Technology (ICT) infrastructure and the internet, e-banking is set to play a pivotal role in the national economic development of any country. But appropriate software, technology, infrastructure, skilled manpower and cyber law are crucial for the implementation of e-banking in the country.

Introduction: In Bangladesh, multinational banks are operating for long besides our nationalized, private and specialized banks. However, much of the resulting research has concentrated on providing evidence of the association between consumers usage patterns of ATMs and their demographic profiles (Hood, 1979; Murphy, 1983) and, more recently, consumer psychographic profiles (Stevens et al., 1986). Besides, the banking services of nationalized, private, and multinationals are different by quality of their services. Multinational banks are offering better services than others. They offer better credit card service, customer services, personal financial services, corporate facilities, trade services with the help of efficient operational department, credit department, information technology department and the most important department is the marketing department. Presently they are thinking to offer doorto-door services, 24 hours banking services with electronic banking, pay and cash management through credit card / internet services. Moreover, waiting to introduce intensive E-banking of the multinational banks in Bangladesh. Customer always demands better services, security, and round the clock banking. Multinational banks are considering customers needs and demand in the first line of preference. Moreover, trying to offer and introduce the demanded services by the Bank and

Changing their offering based on the needs of present and potential customers. Only a few studies regardless of research context have been conducted which focus on the attributes of innovations, as perceived by potential users (Ostlund, 1974; Taylor, 1977). This paper tries to highlight the present condition of electronic banking with credit card service & security in Bangladesh.

Rationale of the study:

Todays world is service oriented in every sector. Those who are giving much more services rather than others are giving; he will be well ahead of competition because of getting better competitive advantages. There are 53 different banks working together in Bangladesh. The competition is going up day by day by giving better services and they are trying to develop their own services every now and then. Electronic banking is known to us since 1990. Electronic banking has got tremendous importance for its credit card service in banking sector and banking customer as well. This is why, the researcher find some interest to explore something regarding e - banking in some extent.

Methodology of the Study:

The study covered some multinational, private commercial banks, which mainly situated in the capital city of Chittagong in Bangladesh. Some of the respondents were in the capital city of Dhaka. Data have been collected through a structured questionnaires especially from a video documentary. In addition, the websites of relevant institutions has been review for updated information. We also collected information from internet. This research has been done through documentary study and secondary methods. Secondary study made through finding out in internet, different books, journals, and articles in the libraries. Data has been equipped through relevant statistical methods.

Limitations of the study:

There has no plethora research work in Bangladesh perspective particularly. The study covered a very limited number of organizations and respondents as well. Some respondents were neither motivated nor interested in expressing their honest opinions. The scope of the study was also constrained by limited available self-funding.

OBJECTIVES: This paper aims at the following objectives: 1. To study about the timeline of innovations & problems of using credit cards 2. To bring out the overview of credit cards 3. To study about the credit card frauds and measures to prevent and detect way to prevent them.

Credit Card? A credit card is an instrument which provides instantaneous credit facilities to its holder to avail a variety of goods and services at the merchant outlet. It is made of plastic and hence popularly called as plastic money. The holders can use the cards to get credit from banks up to 45 days. The credit card relieves the consumers without any risk of carrying cash and ensures safety. It is a convenience of extended credit without formality. Thus credit card is a passport to, safety, convenience, prestige and credit.

Parties related to a Credit Card There are three parties to credit card 1. The issuer, 2. The cardholder and 3. The member establishments.

Credit Card Operation: 1) Customers apply and get the credit card. 2) Arrangements are completed between the banker and the seller. 3) The customer makes the actual purchases and signs on the sales vouchers. 4) The seller sends the detailed vouchers to the bank. 5) The bank settles the claims of the seller. 6) The customer receives the intimation for the purchases made by him. 7) The customer makes the payment for the purchases made by him. Credit Card in Bangladesh: A credit card in India is a recent history. Recognizing the potential of credit cards, a few banks in Bangladesh have taken initiative to introduce credit cards. Many merchants in Bangladesh now accept credit cards. Almost all banks in Bangladesh issue either Visa cards or MasterCard. However, international credit card processing is not a easy job in Bangladesh. Whether you go to a Bank or to other credit card processing companies a lot of documents are required to get a credit card.

Total users of debit and credit card 46 lac Total bank provide the service: 37 Total transaction amount in one more than 100 core

Electronic Banking Scams: The last couple of decades have seen huge changes in how we do our banking and pay for goods and services. Unfortunately, scammers are taking advantage of new technology to generate a number of potentially very costly scams. These scams aim to steal your account Information and your money by using credit/debit card information. Many of these scams can look and sound like the real thing, but there are ways of picking up on the warning signs so that you don't lose out.

Types / ways of Electronic Banking Scams:

With technology getting more and more advanced, banks are outdoing each other in adding banking services that can be accessed across various platforms and applications. When customers think banking convenience, online banking is what immediately comes to mind. Unfortunately, with the tough economic times, cyber crooks and fraudsters are also growing more tech-savvy nowadays and this has led to the rise of scams victimizing hapless online banking customers. California-based research firm Javelin Strategy and Research reveals that in 2008, identity theft cases numbered close to 10 million, growing by 22% from the previous year. As with all types of frauds, the best way bank customers can counter this is to have more information and be fully aware of the possible dangers that lurk in cyber space. Here are 5 of the most common online banking scams that consumers should be aware of:

Although many online banking consumers are now aware of what phishing is, a lot of them still fall victim to it. According to research firm Gartner Inc., about 5 million lost money due to phishing in 2008. In electronic frauds, phishing is perhaps the oldest form of identity theft where scammers send out an authentic-looking email that purportedly comes from the victims bank, requesting him or her to update his or her account information for various official-sounding reasons. The client will then be asked to click on a link that is supposed to direct him to the banks website but instead takes him to a site that looks exactly like the bank site but is actually a fraudulent one, where the scammers can record whatever pertinent data the client enters. To avoid being conned into a phishing scam, never click on links for bank account updates. If any account updating needs to be done, do so by typing in the bank website (usually yourself. If you receive any bank emails be sure to call your bank to confirm if this is a legitimate communication.

Stolen Passwords:
Stealing, cracking, or guessing passwords is another method widely-used by hackers to gain access to bank accounts or financial transactions. Studies have shown that the more experienced and technologically advanced of these hackers can make about one billion guessing attempts in one second. The best prevention bank customers have against these attacks is to use more secure passwords. The longer passwords are usually harder to crack, as are passwords that are composed of both letters and numbers. A 5-character password can be cracked in 10 seconds, while an 8-character can only be correctly guessed in 115 days. In addition, if you cant commit your passwords to memory, make sure that you record them in a secure document and not in plain view of anybody who passes by your office desk.

Worm or Virus Attacks:

Another form of online scamming that is getting to be more popular these days is the use of worms or viruses. Consider this scenario: A friend of yours in MySpace or Facebook invites you to watch a must-see video. Thinking that you know the sender anyway, you click the link to watch. Then the computer freezes and you are informed that your video software needs upgrading. Once you click to upgrade, what you get is not an updated version of your video player, but a Malware or Trojan horse. Once the virus enters your computer, most of the data in your computer will be copied and sent to the hackers, who then will use whatever information they can glean to access banks accounts or financial documents. There are even more advanced types of Trojans which can make fraudulent transfers while an online banking client is logged on to the banks website. To protect your computer from Trojans and Malware which are now getting all too common, invest in an up-to-date and effective anti-virus software. Also, you would want to be careful on what sites you are logging to on the web as many of these sites can unwittingly transmit these viruses.

Malicious Software on Computers in Public Places:

Cyber crooks have also learned the art of preying on individuals using public computers. These hackers even go as far as working in hotels, airports, internet cafes, and other business centers where people go to access the web. They start their fraudulent schemes by installing software on the computers which records the keystrokes entered on the computer. As soon as someone accesses an online banking site through these PCs, the account data such as username or password, will be stored by the malicious software earlier installed and sent to the scammers computers. It is advisable then to refrain from accessing your online bank accounts when using computers in public places.

Targeting Wireless Networks:

While using a wireless network can prove to be very a convenient mobile access to the internet, it is also very vulnerable to fraudsters hacking including interference, hijacking, eavesdropping, and other similar wireless attacks. Take extra precaution when using wireless networks especially outside of your home or office, although even these locations can still be penetrated by financially-motivated scammers.

Credit Card Fraud: Credit card fraud is a wide-ranging term for theft and fraud committed using a credit card or any similar payment mechanism as a fraudulent source of funds in a transaction. The purpose may be to obtain goods without paying, or to obtain unauthorized funds from an account. Credit card fraud is also an adjunct to identity theft. According to the United States Federal Trade Commission, while identity theft had been holding steady for the last few years, it saw a 21 percent increase in 2008. However, credit card fraud, that crime which most people associate with ID theft, decreased as a percentage of all ID theft complaints for the sixth year in a row. Today credit card fraud is one of the biggest threats to the business world. In simple terms, credit card fraud is defined and is committed in the following ways: a) An act of criminal deception (mislead with intent) by use of unauthorized account/personal information; b) Illegal or unauthorized use of account for personal gain;

c) Misrepresentation of account information to obtain goods and/or services. Credit card frauds can be broadly classified into three categories: card related frauds, merchant related frauds and internet related frauds. Different credit card frauds are as follows: a) Application Fraud: This type of fraud occurs when a person falsifies an application to acquire a credit card. Application fraud can be committed in three ways: a) assumed Identity, whereby an individual illegally obtains personal information of another individual and opens account in his or her name, using partially legitimate information. b) Financial Fraud, where an individual provides false information about his or her financial status to acquire credit. c) Non-received items (NRIs) also called postal intercepts occur when the card is stolen from the postal services before it reaches its owners destination. b) Lost/Stolen cards: This type of fraud occurs when a legitimate cardholder loses the card or someone steals the card for criminal purpose. c) Amount Takeover: This type of fraud occurs when a fraudster illegally obtains all the personal confidential information of any beneficiary person. Then being impersonate as the genuine cardholder, he/she informs the bank that his residential or office address is hanged. Next, he/she reports that his credit card is lost and request for mailing of a new card to his new address. He/she receives the card and thus the criminal is able to successfully takeover the account. d) Counterfeit Card Fraud (also known as Skimming): A counterfeit, cloned or skimmed card is one that has been printed, embossed or encoded without permission from the card company or one that has been validly issued and then altered or recorded. Most cases of counterfeit fraud involve skimming, a process where the genuine data on a cards magnetic stripe is electronically copied on to another card, without the knowledge of the legitimate cardholder. Skimming can occur at retail outlets particularly bars, restaurants and petrol stations. e) Card-not-present (CNP) Fraud: This type of fraud is conducted over the Internet, by telephone, fax and mail order. It occurs when criminals obtain card details by the theft of card details of any individual from discarded receipts or by copying down details of cardholder during a transaction without the legitimate cardholders knowledge. It is now seen largely in UK. The problem in countering

this type of fraud is that neither the card nor the cardholder is present at a still point in a shop. f) Triangulation: It occurs when a fraudster acts as a bogus intermediary to connect legitimate customer and the merchant. He advertises and sells an item, receives the payment and then fulfills the order by using stolen credit card details. g) Mail Non-Receipt Fraud: It occurs when a criminal intercepts a replacement card sent to a legitimate cardholder and uses it. h) Identity Fraud: It occurs when someone illegally obtains personal information and repeatedly uses it to open new account or to initiate transaction in the name of legitimate customer. Majority of identity thefts occur offline like stealing the wallets, intercepting the mail or rummaging through the trash. i) Phasing: It occurs when the criminal solicits sensitive information like the cardholders financial data or other account related information through e-mail posting to be the card- holders banker or seller where the cardholder as made recent purchases. Credit card fraud has become regular on Internet. Through all the agencies involved in the transactions i.e. cardholders merchants and the card issuers suffer losses, but among them merchants are the most affected in credit card fraud.

Credit Card fraud in Bangladesh:

Several gangs involved in credit card fraud in Dhaka and Chittagong have cheated many cardholders out of their money, using hidden cameras and other devices. They set up cameras above ATM machines to record the clients typing in their passwords and a Near Field Communication (NFC) device on the booths doors to copy the cardholders information as they swiped their cards. They then put the information into new cards with magnetic blank strips, using devices that can read and write cards. The Detective Branch of police on Saturday busted two such fraudsters belonging to two gangs in the capital. The arrestees told police that they used to enter ATM booths of different banks with fake ID cards introducing themselves as IT experts and maintenance engineers of the banks. In the name of security upgrade, they told the clients to swipe their cards in the NFC (a wireless connectivity technology) devices, mounted on the doors. When the cardholders did so, the fraudsters got their hands on all the information they needed.

Using duplicate cards, they withdrew money from ATM booths or purchased products from different shopping malls and later sold them at a discount, said DB Joint Commissioner Monirul Islam at a press briefing at the media centre of the Dhaka Metropolitan Police.

Analysis of the environment of the situation:

This incident took place in a Swapno chain super shop where most of the people are purchasing goods by using their credit or debit card. But the problem is that the security control of this chain shop is very much poor. For this reason the employee who are working in this shop are the member of scammers. Their main target is to steal the credit card pin number and others information of the customers who use the Credit card. By using a simple techniques they steal this information and steal all the balance of the customer money from their bank account. But unfortunately the customer did not have any idea about this kind of crime. So they are being a victim. For this reason the customers are lost their credit card excess and the criminal use their card pin number a stole all the money.

Identify the main issue of the problem:

A credit card scam can come in many forms. For example, scammers may use spyware or some other scam to obtain your credit card details. A scammer might steal or trick you into telling them your security code (the three or four digit code on your card) and then make purchases over the internet or the telephone. If they know your PIN, they could get cash advances from an ATM using a cloned credit card (where your details have been copied onto the magnetic strip of another card). in this case the main issue are given in below:

The Credit card punching many times. The security system of this shop is very much poor The external hacker who are engaged in card skimming are related with the shop employees. Customers were not aware about this crime


Identify the main actors in connection with the problem:

There may be one or more persons behind any credit card scamming. Such as 1. 2. 3. 4.

Employee of this Chain shop Employee of the specific Bank Professional Hacker Skimming: skimmer is a device that captures credit card numbers and other account information.

But for this case the main actors is: Employee of this Chain shop.

Identify the main causes of or determinants of the problem:

Scammers have clever ways to get you to give them your credit card details over the phone, by email or using text messages or physically. Scammers can get your credit card details by:

Tricking you into telling them your credit card number and/or your security code. Installing spyware on your computers so they can see the files you use. Stealing your credit card - you may lose your wallet or have your bag stolen Using card skimming devices on ATMs Accessing information on unsecured websites Accessing details from your online shopping activities


1. Select Strong password:

Use at least 6 characters Use a combination of uppercase & lowercase letters. Include at least one numbers in the password Do not use a name, a word can be found in the dictionary or a series of letters example: 123456

2. Use unique password:

Make different password for using different sites.

3. Scan your computer regularly for virus. 4. Avoid harmful software 5. Always log out on your accounts. 6. Do not share your PIN to anyone. 7. Do not share your card validation code ("CVC2") to anyone. 8. Be Careful With Charge Copies 9. Watch Charges 10. Keep Track of Cards 11. Watch Skimmers 12. Only shop on reputable and trusted websites 13. If you lost your credit cards instantly inform the near branch of your bank or call their customer center to block the card. 14. At last do not bear your credit card with you always without urgent.


15. Automated Teller Machine (ATM) insecurity.

Modern electronic banking concept in the banking services is new for Bangladeshi people. Most of our bank has not any marketing or sales forces to execute the raw and cold business of electronic banking for their own organization. People are not also conscious about the advantages & disadvantages of the technology as well as using debit / credit card security. Some multinational banks are already introduced their marketing activities over their targeted customers for specialized products like electronic products likes credit/debit card which is found very effective. The multinationals are coming up towards people with variety of highly technical products, which can solve the peoples problem and can able to modernize their lifestyle. The growth of electronic banking such as credit card users increasing is a significant manner. However, last 10 years it has got tremendous importance over the bank customer and hopefully it will increase day by day after nurture the product by the professional bankers. Although credit card frauds are found in large number in some major economies like the UK, Malaysia, Japan, Taiwan, Australia, and Hong Kong as compared to India, because credit card industry in India is still in its nascent stage and cards have low credit limits. Of all the credit cards issued in India, 80-85% cards are active which is equal to 3-4 times smaller than Malaysia, which is on credit card fraud list. Although, the incidences of fraud in India are less, the RBI has advised the banks to establish the internal control system to check the credit card frauds within certain limits, and to strengthen their appraisal system. References: SA TV Documentary.