Financial literacy and more
All about credit and debit cards
Some banks have the facility for the individual to set their PIN online too.
There is a link on the website of the bank issuing the card that the cardholder must visit,
There they have to enter the basic details of the card following which an one time password would be generated.
This password should be used to set a new PIN online,
A similar process can be used when one wants to change the PIN online.
Many banks now do not issue an initial PIN for the credit or debit card that they issue.
They send instructions along with the original card for how to set the new PIN.
For this purpose one has to visit the ATM of the bank issuing the card.
There a process is outlined which results in an one time password being sent to the mobile number of the cardholder.
Once this number is entered then the new PIN can be set at the ATM.
A new credit or debit card that is issued is sent to the mailing address of the cardholder,
Separately an initial PIN is also sent to the cardholder on their mailing address.
This is usually a sealed code generated paper.
The cardholder can break open the seal and then use the PIN set for the first use of the card.
They should immediately reset the PIN too for the safety of their card.
PIN is a code that a person has to be enter when they want to complete a transaction using some card.
This is a unique number which only the user of the card would know.
This makes it a layer of safety for the card as any unknown person would not be able use the card.
This PIN is anything from a 4 to 6 digit code that a person has to remember.
A person can change their PIN when they want to maintain the security of their cards.
The usage of a debit or credit card at a contact based point means that the card was physically present at this area.
The machine was able to read the details of the card through a physical contact.
This makes it possible to track the usage of the card.
It is also possible to validate who used the card at this place.
In case of misuse a proper inquiry is also possible as to what happened at the point of contact.
Contact based points are those places where the debit or credit card has to be physically presented for use.
The card comes into contact with a machine during this use so is called a contact based point.
ATMs are one of the most common contact based points where people transact using cards.
The Point of Sale (PoS) machines are also contact based points.
The individual needs to produce the card at the points so that they can transact.
There are a lot of frauds that are taking place with respect to cards and banking accounts.
The leak of sensitive details related to the card or the bank account can lead to a financial loss for the individual.
The two factor authentication is nothing but an addition of another layer of security for a transaction.
For a credit card the basic details of the card and the CVV is the first line of security.
In addition a one time password sent to the mobile phone linked to the card becomes an added layer of safety as only the cardholder is supposed to have this.
For an individual a chip based card is better in terms of safety.
The chip based card has to be inserted into the machine for the details to be read and used,
This makes the physical presence of the card important and it also means that just having the details of the card will not lead to its misuse at a point of sale machine.
In addition the need to enter a PIN when the card is inserted into the machine adds to the safety element.
One still needs to be careful in terms of misuse of the chip based card on the internet.
In a chip based credit card as the name suggests there is a chip present on the card.
Instead of the magnetic strip all the personal information is present in the chip.
The card for its use has to be inserted in a machine so that the chip can be read.
This makes the physical presence of the card essential.
The chip can be seen on the front of the card which will enable an individual to identify the nature of the card.
A magnetic strip based credit card is one where the information about the card is stored on a magnetic strip on the card.
This is the black strip that is present behind the card.
This magnetic strip is passed through a reading machine which decodes the information.
This is why one has to be very careful that the details on the magnetic strip are not captured by someone who wishes to misuse the information.
This is an older technology but still many credit cards across the world still has this in use,