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Wednesday May 19, 06:31
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Virtual Card Numbers A ’Stunt Double’ For Security
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Credit card issuers Citibank, MBNA and Discover are offering what the New York Times terms a ‘stunt double’ for online shopping, namely virtual credit card numbers that are valid for only one purchase. Disposable card numbers are a solution to the risk of hacking, and of online identity theft, since not all of the 400,000 e-tailers in the US encrypt the databases their customers’ credit card numbers are stored in, despite mandates from the card schemes to do so. Credit cardholders can also use one-time numbers to prevent retailers from debiting their credit cards for recurring payments without sending a reminder.
Forrester Research noted that of 12,000 consumers surveyed at end-2003, two-thirds were “very” or “extremely” concerned about their credit card numbers being stolen online. In this context, single-use credit cards are a way for retailers to assuage consumers’ fears over online security and prevent their database being a ‘honey pot’ for hackers. Even if retailers encrypt a customer’s credit card details in a purchase, those numbers have to be decrypted for payment to be collected, and, as the NYT quotes TowerGroup analyst, John Gould as saying, a retailer will not necessarily re-encrypt the card details stored in their database.
(The New York Times)
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