[28 February 2014; BARCELONA, SPAIN] — With ATM and credit card fraud growing worldwide, a Philippine mobile payments company has introduced a solution that lets card users to “lock” and “unlock” their credit cards using their mobile phones.
Mobile-based security overlay to mitigate rising payment-card fraud launched at the Mobile World Congress in Barcelona
[BARCELONA, SPAIN] — With ATM and credit card fraud growing worldwide, a Philippine mobile payments company has introduced a solution that lets card users to “lock” and “unlock” their credit cards using their mobile phones.
Called “LockByMobile”, the new service provides “an additional layer of security by enabling a prepaid, debit or credit card holder to block and un-block the use of the funds in their cards through a few clicks on their mobile phones,” said Orlando Vea, Smart e-Money, Inc. president and CEO.
Based on the award-winning Smart Money mobile payments platform, this solution can be made available to payment cards issued by banks worldwide through mobile phones provided by any operator, explained Vea. It can be applied using smartphones or feature phones.
Smart e-Money is a wholly-owned mobile financial services subsidiary of the Philippines' largest mobile operator, Smart Communications, Inc., which originally developed the Smart Money platform in 2000.
“Given recent developments, LockByMobile is a timely solution that can be quickly implemented by banks and mobile operators and provide greater peace of mind to payment card users,” Vea said.
Concern over payment card fraud has risen sharply because of several recent, highly-publicized security breaches of customer information systems.
In December 2013, Target, a major retailer in the United States, disclosed that hackers had penetrated its network and stolen the payment-card information of over 40 million customers. A few months before that, Adobe Systems reported what it called a “sophisticated” cyber-attack on its network that compromised confidential customer information of several tens of millions of its customers.
The recent hacking of the EMV chip-and-PIN credit card of PayPal president David Marcus during a trip to the United Kingdom has only added to the mounting concerns about payment-cards usage.
Security breaches such as these are expected to further fuel payments fraud. Estimates put the total global payment-card fraud losses at around $11.3 billion in 2012, up 15% from the year before. The United States accounted for nearly half of the total.
“LockByMobile provides a very flexible solution that allows the user the ability to customize what payment functionalities must be locked or unlocked such as ATM withdrawal, over-the-counter or point-of-sale purchase or online transactions. This includes the use of location-based or geo-locking features,” said Lito Villanueva, innovation and emerging payments head of Smart e-Money. "ATM or credit card holders do not use their cards 24 by 7 but they are susceptible to fraud 24 by 7. You only unlock it when you need to use it," Villanueva added.
Its patented features include the Transaction Date and Time Stamp Lock which prohibit transactions at defined dates and times such as when the user is overseas or during hours when the probability of the user making a purchase is low.
The Merchant Category Code Lock prohibits transactions with merchants belonging to certain categories, which the user has a low probability of making any purchase from.
The Merchant Name Lock prohibits transactions with blacklisted merchants.
The Transaction Amount Lock prohibits transactions above a certain set limit by the user.
Country Code Lock and Currency Code Lock prohibit transactions in certain countries and transactions made in certain currencies, respectively.
“With LockByMobile, your ATM or credit card can be locked from any transaction unless you unlock it for a particular use. If your card has been skimmed or used by unauthorized individual, you will be alerted immediately through your mobile phone and the attempted unauthorized transaction cannot be consummated. This is an improvement over current systems where unauthorized transactions still go through and you end up calling your bank to complain about it,” said Benjie Fernandez, Smart e-Money chief operating officer.
This patented innovation will surely provide an added peace of mind among consumers and will be a tool to mitigate the risks among bank issuers.