The main reason credit cards are fraudulently charged is insufficient magnetic card security

The main reason credit cards are fraudulently charged is insufficient magnetic card security
According to authoritative reports, just last year alone, more than 5% of credit card holders in China experienced fraudulent charges, with only 30% receiving compensation after credit card fraud and bearing the loss themselves. In response, a staff member from the credit card department of a state-owned commercial bank suggested applying to use a chip card instead of a traditional magnetic stripe card, and to set a password for greater security.Why is it said that chip cards are safer than magnetic stripe cards?

According to surveys, a large portion of those who have been fraudulently charged are those who used them earlier. These people all hold magnetic stripe cards, and those with chip-based cards have a significantly lower rate of fraud than magnetic stripe card holders.

Expert: Accelerate the popularization of chip cards to improve credit card security
Guo Tianyong, director of the China Banking Research Center at Central University of Finance and Economics, explained that there are many reasons for credit card fraud. Cards without a password are more likely to be stolen if lost. Regarding responsibility for credit card fraud, he believes it depends on the specific circumstances.

Abroad, credit card transactions generally rely on signature verification, which merchants and banks take very seriously. In China, the main method is to use passwords as proof.

To reduce the risk of bank card fraud, on one hand, it is necessary to further strengthen the fight against crime in the financial sector, and on the other hand, to quickly improve the technological content of credit cards through the popularization of chip cards and other means. They hope to enhance credit card security by improving credit card quality, that is, using chip cards to enhance security protection. Since information is on the chip, the cost of copying is relatively high.

Bank: If you lose your card and your card is fraudulently charged, banks generally won't compensate
A staff member from the credit card department of a state-owned commercial bank explained that most banks provide credit card loss protection services for credit card fraud risks. However, whether the bank compensates for fraudulent credit card fraud depends on the specific situation. If the customer loses their card and the card is fraudulently charged, it is considered that the customer failed to properly safeguard it, and the bank will not compensate for the fraud. However, if the credit card is cloned and fraudulently used, as long as the customer can prove they have properly safeguarded it, they do not need to bear the loss themselves.

An industry insider suggests that setting a password for cardholders is more secure. If a credit card is lost and fraudulently swiped, if there is no password, the other party can simply imitate a signature to swipe the card. If a password is set, it adds an extra "security lock."