Location-based services like mobile status updates, exclusive coupons and weather reports have transformed life in the modern era; and companies have taken notice. Visa in particular is looking to tap into the potential that these services provide by offering an enhanced fraud protection program using GPS technology.
The way this new system will work is, whenever your credit card is used at a business or ATM, the location of the credit card will be matched up to your Smartphone. If both are close together then it’s most likely that you are actually making the purchase.
If the two are far apart, however, the system will look to send out an alert to the bank or your phone. But not to worry about what happens if you forget your phone at home or simply misplace it, as the proximity information will only be one of many variables that the system will use to figure out if fraud is occurring.
The main reason for this feature is to create a better experience for credit card users when a particular transaction is different from their expected patterns of use. So the next time you go on vacation and decide to use your credit card, you won’t be bothered with annoying calls from the bank or have your credit card frozen. Instead, the bank will simply check that the card is near you and treat it as a normal transaction.
This new GPS feature will drastically help cut down on credit card fraud, whether it be criminals that steal credit card information for resale purposes, or people that go on shopping sprees and later report their cards stolen.