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Frauds and Misuse of Plastic Cards: By-Anas Khatri

Plastic cards provide convenience but also risks of fraud and misuse. They allow access to funds anywhere but can be lost or stolen. While cards offer advantages like eliminating cash, risk of theft is lowered, and access anywhere, there are also disadvantages like not being accepted everywhere, risk of loss and misuse, additional fees, and potentially encouraging overspending. Proper control and awareness of risks is needed for safe use of plastic cards.

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Yash Mufti
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54 views11 pages

Frauds and Misuse of Plastic Cards: By-Anas Khatri

Plastic cards provide convenience but also risks of fraud and misuse. They allow access to funds anywhere but can be lost or stolen. While cards offer advantages like eliminating cash, risk of theft is lowered, and access anywhere, there are also disadvantages like not being accepted everywhere, risk of loss and misuse, additional fees, and potentially encouraging overspending. Proper control and awareness of risks is needed for safe use of plastic cards.

Uploaded by

Yash Mufti
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Frauds And Misuse of Plastic

Cards

BY- ANAS KHATRI


PLASTIC CARDS
●
Technology has changed the way we deal with
money giving us more convenience and easy
access to funds from anywhere. It all started with a
simple credit card that allowed you to make
purchases today and pay later.Further,
technological advancements lead to a new trend
where most banks gave you one ATM card or debit
card which can be used for withdrawing money as
well as for making purchases or payments – offline
as well as online.
However, plastic money has its share of issues that one must be careful about. Plastic
money definitely provides an alternative in some cases and compliments cash as a medium.

Since he may require a lot of cash for inter-city travel which can span a few days or weeks
he preferred to use his debit card or credit cards.

For instance he could use his card to pay for hotel stays where cards were commonly
accepted. Similarly for travel he could book tickets online, while for food he had to rely on
cash

However, with his debit card he could withdraw cash whenever required which made his life
easier. Even if he forgets to carry cash he can use his debit card to withdraw funds whether
required.
Advantages of Plastic Money
There are several advantages of plastic money as seen in the
above illustration. The advantages include

Eliminates the need for carrying huge cash: This eliminates the
need for carrying huge load of cash which is risky and
inconvenient too.
Risk of Loss or Theft minimized: In case of cash there is a high
risk of losing cash and a chance of cash getting stolen.
However, in case of debit/credit card you can report the matter
to the bank and block the card to avoid misuse.
Anytime/Anywhere Access Using cards you have the unique
advantage and convenience of using it anywhere in the
country or even abroad
Credit Facility: In case of credit card you have the option
of buying on credit or paying later. Although the charges
are high, it helps you in case of emergencies and
contingencies.
Online Payments: You can use cards for online payments,
fund transfers and various other transactions.
These are the key benefits which I can easily remember,
but there could be various other good features too that are
specific to certain cards
Disadvantages of Plastic Money
So far I’ve been sounding like a nice, pleasant Bank
Executive who is convincing you to open an account.
Please note a few points before we look at the
disadvantages of plastic money

Cards/plastic money is not a complete replacement for


cash
Use of cards can also be risky in some cases
Note: I’m not saying that cards are not useful because of
these drawbacks. The disadvantages are just to make
you aware of any risks, threats, etc so that you can use it
carefully.
Some of the drawbacks or risk related to cards are
1. Non-Acceptance at Small Retail Outlets

Unless you are a person who shops only in supermarkets and


hypermarkets you will be forced to use cash

2. Cannot be used for all daily needs

You cannot pay your milkman, servant, paper wala (newspaper


guy), etc by card.

3. Loss & Misuse

Once a card is lost you have to immediately report it and get


the card blocked to avoid misuse. Sometimes when you are
not aware that you lost the card….the chances of misuse is
higher.
4. Low Value Transactions

As discussed above already there are cases where small and


medium sized retailers don’t accept cards for low value
transactions (say less than Rs.200 or other criteria). You may
have noticed this even in case of outlets like petrol bunks or
restaurants.

5. Service Charges

In some cases the outlets charge additional service charges


for cards. So this can be another burden on your pocket.
6. Damage to Card

Sometimes the card’s magnetic strip gets damaged or


scratches or cuts can render the card unusable. So keeping it
safe and secure is very important.

7. Carrying or Keeping the Card

Keeping the card and cash in the wallet together is like


“inviting trouble”. This is the way everyone (including me)
used to carry cash and cards. But this means once you lose
your wallet you lose everything.

So here the card doesn’t come to your rescue after losing cash.
The best practice is to keep cash and cards separately so that
if you lose one you have the other to bank upon
8. Spending Habits & Other Tips

Whether you use cash or cards, having a control on your spending is very important. A few
pointers would be worth noting.

9. Impulsive Purchases

Don’t yield to impulsive purchases. Try to see what real benefit or value are you getting from
the purchase. If you can’t live without it you can postpone or keep the spending on hold.

10. Peer Pressure

Its okay to spend some money on entertainment, outing, fine dining, etc. once in a while
(say once or twice a month).

But if you do it every week on instance of your friend, colleague, etc you will have not
savings every month end. Your future financial planning is out of question if you live from
pay cheque to pay cheque.
11. Overuse of Cards

I find that people who are finding cards as a convenient


medium try to use it everywhere – left, right and center.
Further, they have 3-4 cards which are used one after the other
at different places. I would advice them to have fewer
transactions so that it is easier to keep a check on the
transactions every month and easier to pay the bill as well.

12. Special Offers, Discounts

Some people have this fancy and think that they are smart
when they get special discounts on cards at retail outlets.

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