A version of the is post originally ran in October 2015. It has been updated for the 2017 holiday season.
The 2017 holiday shopping season officially opens this weekend, and it promises to be the most lucrative ever for retailers.
Gallup data reported in Business Insider suggests that the average American will up his or her holiday spending this year to $862 – a dramatic increase over last year’s $752 figure. Bloomberg reports that 2017 holiday spending overall is expected to grow by 6 percent. And, according to the National Retail Federation, 69 percent of Americans (164 million people) will begin shopping this weekend to take advantage of Black Friday specials.
While exchanging gifts is a joyful holiday tradition for many, shopping this time of year can also create angst if personal or card data is compromised.
Keep Members Safe in Stores and Online
“We all know that Black Friday is the biggest shopping day of the year, which means card usage is much higher than usual,” said Amanda Atcheson, director, marketing and brand strategy for CO-OP Financial Services.
“Fraudsters see Black Friday as an easy opportunity to take advantage of a much larger pool of consumers. Not only do we routinely see Black Friday data hacks to steal card information from large retailers, but we also see fraudsters targeting individual cardholders with online scams and e-mails that turn out to be malware. This can be an even bigger problem if passwords are stolen and identity theft occurs.”
According to Atcheson, cyber-fraud is a particular concern this year because consumers are increasingly purchasing via online and mobile channels.
“TMCnet.com estimates that consumers will complete 50 percent of their holiday shopping online, and 34 percent using mobile devices,” she said. “To transact safely, all consumers should know not to click on links in unsolicited emails, and to instead type the merchant’s URL directly into their web browser.” She adds that consumers should use Visa Checkout and Masterpass when available as well, e-commerce tools that keep account numbers and personal data out of a fraudster’s reach.
To combat card-present fraud, says Atcheson, consumers should avoid swiping cards at checkout, and use only EMV-enabled or contactless terminals at the point of sale.
“EMV chips make it virtually impossible for fraudsters to create counterfeit cards,” she said. “Tokenization used in Apple Pay and other digital wallets encrypts a consumer’s card number so fraudsters cannot access it. Cardholders just need to know about the benefits of these advanced technologies – and they need to use them consistently.”
That is where credit unions can help, Atcheson notes, first by making advanced fraud-prevention tools available to members, and then by educating them on how to install and use them.
“Credit unions should also encourage consumers to take security into their own hands by monitoring their transactions and reporting any suspected fraud immediately,” she said. “In addition to the security embedded in today’s payment platforms, consumers can take advantage of smartphone apps such as CardNav by CO-OP that allow them to set up controls for card usage, receive real-time alerts when unapproved transactions occur, and even temporarily disable their own cards if needed.”
Using Data Analytics to Fight Fraud
Behind the scenes, Atcheson advises credit unions to also closely monitor member transactions using preventative analytics tools. “Data analytics can be extremely effective at identifying anomalies in a member’s card usage and uncovering potential points of compromise,” she said. “Having analytics in place now can make a big difference in securing member accounts and avoiding service disruption during the holidays. Plus, these tools pay for themselves quickly by minimizing credit union losses due to fraud.”
She continued, “As FinTech redefines how payments are made, and new players such as SnapChat, Facebook and Venmo continue to evolve the P2P payments market, consumers need to be even more vigilant in protecting their account information. For example, they should know that it is much safer to use a P2P app offered through their credit union than to submit payments through social media sites or other venues of questionable origin. Education is important, and as a credit union you will only enhance your member relationships by providing it. As a trusted partner, you can help members safely shop throughout the holidays with the technologies they need to play defense against fraudsters and win.”