Credit cards can be replicated into fake and can cause loss of profits for a business!
In this age where credit card payment is one of the safest ways to purchase things or collect money. Card payment is safest because it has a thin layer of protection for buyers and merchants. Where the banks and card brand networks directly deal with the amount transactions. Also, cross-check the authenticity of the transaction and also give the support to customers. If they face any difficulty dealing with the merchants and if customers feel merchant is fooling them.
The use of card has some undeniable drawbacks. This can lead the cardholder to become a victim of fraud activities on their bank accounts. One such drawback is cloning of the credit card and using the card for whatever they want.
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The Cloned Cards
For these type of transactions done through, the cloned cards card holder still can recover money. Especially, if some purchases take place through the card. But, the merchants face transaction dispute if they process a transaction, accept authorization and send the request for funding to the bank. This type of dispute is “counterfeit transaction”, that mostly occurs when a fake card is in place for the purchase.
The thing that helps to detect the transmission done is valid or not, is a merchant fails to compare the embossed account number on the card with the number printed below the embossed number. The reason that can cause such condition is the information of the magnetic stripe was not collected correctly.
For this transaction dispute, customer bank gets a written request from the customer, in which customer claims that the card was present with them during the time of the transaction and they did not participate in the transaction. In this condition, the bank initiates the chargeback and asks the merchant to pay back to the customer. This condition of “Counterfeit transaction”, is designated with a specific reason code, by the card brand networks, that helps merchant know how to manage such chargeback cases and what to provide to the bank as proofs if the transaction is valid or not. VISA has assigned reason code 62 to this error and the Master card has assigned reason code 4862.
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Manage the information
To manage or send the information to the bank is signed receipt of the transaction. A merchant can send the print of the receipt if the merchant has swiped the card and transaction was authorize during the sale. If the merchant finds the transaction was done from the fake card, they should accept the transaction.
The only way to be safe from such transaction errors is to check carefully the card and numbers imprinted on the cards. If the merchant feels that the card is suspicion for any reason. They should avoid making payment from giving the card and if the payment is processed by the merchant and finds that something is wrong. They should call the bank for any further action.