Card Fraud is Rife in SA, but SA Has One of the Best Card Fraud Regulations

13 Jun

Unfortunately card fraud in South Africa is a reality. Fortunately though, it’s not overly feared as both merchants and consumers are aware that card transactions are protected by the PCI DSS (Payment Card Industry Data Security Standard) which is set in place specifically to prevent fraud.

Card regulations in SA make fraud difficult, from the very first step of the transaction

Merchants and their banks are required to store credit card and debit card information securely and it has to be password protected as well as encrypted. This provides a measure of compliance as well as an additional level of protection for those processing card transactions. Unfortunately, no system is impenetrable.

Most legitimate online payment systems are compliant with PCI DSS and users can take comfort in knowing that their data is encrypted when captured. Unfortunately, consumers aren’t entirely wise to the world of phishing and can find themselves providing credit card details to sites without the correct mechanisms in place.

PCI DSS insists that merchants processing cards must meet with 12 universal requirements. The rules in place are determined by big card names such as Discovery, American Express, Mastercard and Visa. The banks that these brands work with are regulated and secured.

The risk doesn’t always lie with the consumer

Updated authentication practices are continuously being introduced in SA as new threats and attempts are uncovered. Take for example the new chip cards with authentication pin that now require dual-authentication, and the recent announcement of the Mastercard biometric cards that are in the testing phase. As these changes are made, regulations in terms of card security and anti-fraud mechanisms are updated. It’s something that South Africa has been on point about.

It’s interesting to note that the majority of the risk lies with the holding bank, and not with the consumer, should fraudulent activity happen on their card. If all the safety mechanisms are in place and fraudulent transactions occur, the consumer can dispute it with the holding bank for the amount to be reversed.

Phishing is the Number One Cause of Card Fraud in SA

Unfortunately, phishing is still the number one cause of card fraud in the country and in most cases it happens when a transaction is made online, on an unfamiliar site. There are ways to determine if a website is suspicious or not. Here are a few tips:

  • There are no available contact details – if there are contact details, call the company to confirm legitimacy
  • Browse the site and look for spelling errors or anything that might imply they are not a professional company
  • Look for poor quality graphics
  • Check for the payment gateway security that they offer – it should be made visible on their payment page
  • For your own peace of mind, you can also check who the website belongs to / is registered to at the following link: https://www.registry.net.za/whois/

The South African card fraud regulations and protection plans offer a comforting level of security, but it is up to the consumer to ensure that fraud does not occur due to negligence on their part. Always check that you’re transacting on a safe and secure site or look for alternative payment options if you are worried about entering your card details into an unknown website.

Have you been a victim of card fraud? Let us know what happened and how you handled the situation.

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