You may or may not be aware, but you can store your credit and debit cards on your phone. You can then pay for products with by simply tapping your phone on most debit card readers.
With this comes the concern: Is this safe? Well, it is much safer than carrying the cards with you.
When you carry the card with you and use it, you are susceptible to a lot of scams.
Skimmers
Scammers install fake covers (called a Skimmer) on the card readers in bank machines and gas station pumps. When you insert or swipe your card, they record all the information that goes through it. They also install cameras so they can capture the PIN you enter. You don’t notice a thing. That is, until you get your bank statement or alert that your account has been drained.
Shimmers
Shimmers act almost like a Skimmer, but shimmers copy the data from the chip part of the card. Shimmers are harder to detect than Skimmers as they are inserted inside the slot where the card goes.
Fake Tap To Pay Readers
A Scammer will approach you with a portable card reader or phone pretending to be the merchant or for a fundraiser. When you tap to pay or donate, they charge your card.
Card Cloning
When having gathered the required information through Card Skimming, the scammers can then clone your card. It will act exactly as if it was the original card.
Distraction
The scammer will distract you after you enter your PIN in the machine. They will drop something or get your attention elsewhere while somebody else grabs the card. They were paying attention too when you entered your PIN.
Fake ATMs
Scammers setup fake bank machines or ATMs. They look real but are designed to capture your information. They never dispense cash and display an error or malfunction message after the card is read.
Card Swapping
When you hand your card to somebody else the scammer can swap the card for a card that looks exactly like yours, same bank, etc., but will have a different number and name on it. It would be hard to tell until you went to use it next.
How to Protect Yourself
- Use Tap-to-pay when you can. Avoid inserting your card into any machine or swiping it.
- Wiggle the card slot before you insert your card, if it moves, is loose or is bulky it could be a skimmer
- Look for hidden cameras near the keypad
- Cover you hand when you are inputting your PIN
- Never let your card out of your sight, Always keep an hand on it at all times
- Review your statements regularly and check for anomalies
- Only use bank owned or trusted ATMs, and only in well lit areas
- If you have to give your card to somebody else to process the payment, make sure you get your card back. Double check the card number and name on the card if there is one.
- Use a Wallet App on your phone (see our companion article here)