However with all the ease of use that debit cards provide, there are a certain precautions that one should take at all times and there are certain places where using your debit card might not be a good idea as you risk your account being compromised which means putting all your available funds at risk too. Below we will mention a few scenarios in which you should be careful not to use your debit card:

Out of Sight PoS:
You should beware of places where you give your card to the sales person to be swiped somewhere else such as at fuel stations or restaurants. The reason behind this is that you could become a victim of skimming hence always make sure that the cards are swiped infront of you or use a credit card to pay at such places if it’s inevitable.

Online:
It’s also a wise idea not to use your debit card for online transactions as you expose your personal account details tied to your own funds in every transaction. Also unlike credit cards there’s no credit limit that can be exhausted hence your total funds could be compromised. Also when you use credit cards it’s easier to report frauds as it’s the banks money that you’re lending so the bank is responsible to counter any frauds or losses and issue refunds. There’s also a due date for your bill payment till which any issues or disputes between the merchant and card holder can be resolved. However in debit cards all these safety measures are unavailable. Also if you run into any fraud using your debit card and block the account then it’ll be another hassle for you as you’ll be unable to access your own funds for a certain period of time and you’ll have to resort to withdrawal from cheques until you get your replacement debit card issued.

Refunds:
Using debit cards at places where you’re buying good from a merchant is also not a good idea. The underlying reason is that if by mistake you get a faulty or wrong product, or the product is not the same as advertised and you wish to get a refund, then it will not be as easy as with a credit card. It’s also pertinent to mention here that the refund duration varies from 1-15 days depending on the merchant, merchandise and the location of the transaction i.e if it’s done locally or internationally. During this tenure your own available funds will be affected for the time being. Hence using a credit card is a better option

Foreign Destinations:
It’s also advisable not to use your debit card at foreign tourist locations because some locations still use the Magnetic stripe instead of the newer Chip and Pin system which means that you’re more vulnerable as using a debit card at point of sales where the card is swiped instead of dipped can lead to your own funds being at risk. Credit cards are safer to use while traveling abroad as you’re borrowing money from the bank and you know you’ll be spending within a specific limit hence it doesn’t make sense to expose your private bank account details that are tied to your own funds.

If you follow the above tips you can make safe, secure and hassle free transactions using the right card for the right place. If you have any feedback let us know the comments section below.

Khurram Zahid

The post 4 Places Where You Should Not Use Your Debit Card! appeared first on Smartchoice.pk.

The chip-and-PIN ATM card technology is not really new anymore as it has been in use in the UK since 2003 and recently the US has been adopting it. It has many advantages over the older magnetic stripe such as it being more secure and it’s not damaged by magnetic fields. Hackers are always out and about trying to crack security systems but it’s easier said than done hence it has been in use since a long time and only now and it has been compromised as well and now they can hack the system and steal your cash. It’s not as easy as on a magnetic stripe card but it’s still very much possible with the right technique and tools. So far theoretically it was impossible because the security protocols encrypted data much more securely as compared to a magnetic stripe card which holds all the data on the magnetic stripe on the back of the card.

US adopted this new system because it would improve the security for the customers, merchants and financial institutions. This is true, but the problem is that when the market pushes in one direction, in this case the adoption of the chip-and-PIN technology, crooks exploit to ways to compromise it.

A new “shimmer” was found, that can be inserted directly in the mouth of the ATM card receptacle, between the chip of the user’s card and the chip reader in the ATM, making possible to record the data from the card while the ATM is reading it. It is fast as it works on dip readers as well (the kind of card reader that requires you to briefly insert your card and then quickly remove it) The device is inserted from the outside of the ATM and no access is required to the ATM internals. Together with a hidden camera and/or a fake PIN keyboard, this can be a deadly combo to steal money.

Using X-Ray scan and other microscopic scans, the researchers figured out that the criminals actually inserted a second chip onto stolen chip-and-PIN cards, enabling them to duplicate the PIN verification on many registers’ point-of-sale (POS) terminal.

The fake chip, known as a FUNcard, enabled the thieves to carry out a Man In The Middle attack, which involves intercepting communications on the point-of-sale (POS) terminal. When a shopper inserts his or her card into a POS terminal, the terminal automatically tries to verify its authenticity. In this case, the FUNcard is waiting with its own, fake “Yes” signal when the authenticity check arrived.The attacker intercepts the PIN query and replies that it’s correct, whatever the code is.

Until 2011, the concept of spoofing the PIN on a chip-and-PIN card was largely theoretical. A group of Cambridge University researchers discovered similar flaws, but this crime ring appears to have been the first time the trick has been practically implemented. Malicious software used on ATMs in Russia and Europe has also broken through chip-and-PIN safeguards, allowing thieves to drain ATMs of cash in at least one case as reported by several news outlets.

We think this was coming, as we mentioned earlier than any man-made technology has the risk of being reverse-engineered, manipulated or hacked in some way sooner or later. We hope that the companies responsible for ATM security protocols devise better safeguards and close any loopholes to avoid huge monetary losses in the future.

It is also pertinent to mention here that this new technology is now also being introduced in the Pakistani market. Banks like UBL, HBL and Faysal Bank are now offering these new chip based cards. However chip-and-PIN technology might totally not be implemented in its true form because the banks have still not implemented the PIN codes and customers still have to manually sign their receipts. The Government  is considering a regulation to enforce banks to move from magnetic stripe to Chip-and-PIN within 3 years however this might get delayed as we don’t have any data for ATM fraud yet because no bank publishes it as well as the fact that Chip-and-PIN cards are more expensive than the current magnetic stripe ones. Even though this newer technology has been compromised we feel that it should be definitely implemented in Pakistan soon.

Khurram Zahid

The post Hackers Crack Chip-and-PIN for Real! appeared first on Smartchoice.pk.