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What is Credit Card Skimming, and How to Prevent it

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What is Credit Card Skimming, and How to Prevent it

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What is Credit Card Skimming?

Credit card skimming is the equivalent of robbery, in which the perpetrator uses a skimmer to steal a credit card's personal information. A skimmer is essentially a device that clones the card information and stores it for later use.

In the case of skimming, each piece of information on the credit card's magnetic stripe is stolen and stored by the skimmer as it is swiped through the machine. The cardholder’s full name, card number, and expiration date of the card are all stored in this stripe. Credit card skimming lets criminals make purchases, steal money off accounts, and trade card information to outside parties for similar uses.

Can chip-based Credit Cards be skimmed?

Theoretically, yes. But it takes a little longer for the information on the chip to be cloned. This is because chips store encrypted information, while magstripes are easier to clone and can be done in one swipe. All major card companies like MasterCard, Visa and RuPay are now phasing out magstripe card in favour of chip-based cards as a security measure.

What is skimming of credit cards: What happens next?

Once the card skimmer has obtained your card's information, it can be used for:

  1. Identity fraud: This occurs when the thief creates false accounts or applies for a loan in your name using your personal details and credit card information.
  2. Purchases: The skimmer can use the stolen information to make online or in-store purchases. A theft like this is referred to as "card not present" fraud.
  3. Replication: It is possible for the information to be shared with other parties and to be copied onto counterfeit credit cards.

Some Ways in which Credit Card Skimming is done

Here are some ways in which credit cards can be skimmed. Note that this list is just cautionary in nature, and not intended to insinuate that petrol pumps, restaurants, or any other commercial establishment voluntarily indulge in skimming activities.

Petrol Stations and ATMs

At gas stations, credit card machines and ATMs sometimes have credit card skimmers permanently installed. It’s possible to create counterfeit credit cards or even steal money from the cardholder’s account. Although not technically skimming, a small camera close to the ATM machine could capture your PIN as you punch it into the machine.

Retail Outlets and Restaurants

Shops and restaurants can both use credit card skimmers. There may be frauds at certain restaurants who skim your card information off. Again, there’s no way to tell the honest ones from the frauds, but good to generally be on your guard.

Shoulder surfing

Shoulder surfing is where the fraudster observes the card user punch in the code while posing as someone else who is also waiting to use the machine.

Ways to prevent credit card skimming

Generally, credit card skimmers intergate into the ATM or credit card machine they are installed on. These devices are hard to distinguish. You can be fairly certatin that a credit card skimmer has already been installed on the device if it appears that an additional part is attached to the credit card reader or that a portion of it protrudes oddly.

That said, here are some other ways to use your credit card that are more secure, and can prevent fraud:

Use a Chip Card

Most cards issues today by card companies, banks, and other financial authorities are mandatorily chip-based. You can tell a chip card apart from a regular strip card in the image below.

EMV (or Europay, Mastercard, Visa) chip cards have a greater degree of security compared to magnetic stripe cards. Magnetic strips store information on a one-time basis, meaning that the information on the stripe is not rewritten. EMV chips on the other hand, store an encrypted code that dynamically changes with every transaction. This digital signature is hard to copy and renders the data on it virtually impossible to replicate or steal without going undetected.

Pay using the contactless method

You can tell if your card can make contactless payments by looking for the icon on the card (see image below). The icon will be printed on the card next to the chip, indicating that you can tap the card to the POS device (card machine) and make the payment. Aside from the fact that contactless cards don’t need to be inserted into the the device to authenticate the transaction, the data transmitted by the RFID embedded in your card is as secure as the chip that your card comes with. Visa Platinum is a widely accessible card type that allows contactless payments. Fi Money gives you a Visa Platinum debit card with your Fi Money account, in case you’re wondering how to get your hands on it.

What to do if your credit card is skimmed?

In most cases, credit card issuers employ fraud detection technologies and have the power to block your credit card right away if there are any indications of fraud. However, keep in mind that until the issuer alerts you about the fraudulent transactions, you might not even be aware that a credit card has been skimmed. Wondering what to do if your credit card is skimmed? As soon as you notice the fraud, get in touch with the credit card company right away and ask the authorities to block and stop all use of your card.


Credit cards today have measures to help reduce the likelihood of such frauds, for instance, chip cards, which do not require swiping and also secure the transaction data. Additionally, cards have a contactless feature, which do not require insertion of the card into the machine.

Frequently Asked Question

1. How does credit card skimming work?

Typically, the compromised credit card reader hardware covers an existing, real ATM or payment equipment. The fake reader gathers and transmits payment card data for the thief to retrieve. PIN numbers can be obtained using a covert camera or a keypad overlay.

2. Can someone skim your credit card?

Yes, anyone who uses a credit card at ATMs, petrol stations, restaurants, or retail outlets is susceptible to credit card skimming theft.

3. How do you tell if your card has been skimmed?

You are likely to receive an official message about any unwanted transactions made in case your card has been skimmed. It is always important to monitor your accounts regularly.

4. Can a card skimmer get your PIN?

Yes, a card skimmer placed in an ATM or a retail checkout can record your PIN and other crucial details of your card. it's best to check for tampering, oddly placed camera's and small recorders to keep an eye out for the same.

5. Can chip cards be skimmed?

Yes, chip cards can be skimmed as well. Although this a fairly long process and is comparatively rare. This is because chips store encrypted information, while magstripes are easier to clone and can be done in one swipe

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