Visa Transaction Alerts via email and mobile phone
Posted on Friday, August 22, 2008 by Bryan Johnson
Digital Transactions reports today that in 2009, in an effort to reduce credit card fraud, Visa will provide cardholders the ability to be instantly notified via email or text message of any usage of their debit, credit or ATM card. The service is in beta with a number of U.S. and Canadian banks.
The system will allow users to set transaction amount notification thresholds. If a transaction is suspicious users can immediately call a 800 number to report it. Today it takes 98 days on average to detect identify theft and 72 days for bank card fraud (Javelin Research).
This type of notification service has the potential to dramatically reduce that. So in short, Visa is shifting fraud screening and prevention costs to cardholders. Nice work Visa.
Comments
Walt Conway said on Monday, August 25, 2008:
Maybe Visa is not so much "shifting" fraud screening and prevention to cardholders, as they are "involving" them in the process to speed up the identification of fraudulent trans? Faster fraud screening mainly benefits the issuer (thank you, Reg W), but the cardholder has some skin in the game, too. To your point, though, I'd sure feel better if the brand (or issuer) paid for all the extra text messages I'd be seeing on my cell phone bill. (Full disclosure: I worked for Visa at one time.)
Bryan Johnson said on Tuesday, August 26, 2008:
I didn't know that Walt - I'll now watch your comments with a bit more suspicion :)
Regarding your comment, because cardholders have no fraud liability, the only real motivation they would have is to prevent identify theft. It has much greater consequences and is significantly more difficult to resolve. From what I understand, working work with the three credit agencies to get identify theft cleaned up is nearly a full time job. A much more difficult task than updating a newly issued credit card number with monthly billers. It's a smart move by Visa.
Forrest Holleman said on Monday, December 08, 2008:
Bryan - your comment "...because cardholders have no fraud liability... is partially correct. It is true for credit cards in the USA. In the USA, debit and prepaid cards do not have quite the same protection for the cardholder. And, even if cardholders had no fraud liability, they still would be without their cash for fraudulent debit and prepaid transactions until their issuing bank made good with a refund - which could take weeks.
The initial SMS text alert notifying them of the first fraudulent transaction might be too late, but they could then immediately freeze the card to prevent further draining of their accounts.
Also, in most other parts of the world, the cardholder does not have nearly the same degree of fraud liability protection as we have here in the USA, and Visa is a truly global organization.