Top 4 credit card safety tips every international traveler must know

You can fund your overseas trip for personal/professional reasons, business or vacation with your credit card. Though credit cards offer a lot of benefits such as low forex mark-up fee, rewards and discounts on flights as well as hotel bookings for international travel, you have to be careful with your usage.

There are several things that you should do to keep your credit card safe from fraudulent or unauthorised transactions when you are abroad. Setting limits on your international transactions and informing your bank in advance about your travel plans top the list of things that you should do before you embark on your journey. Here is a primer on how to protect your credit card from misuse during international travel.

Notify your bank in advance

This is the first thing that you should do if you plan to use your credit card during your overseas trip. You can provide travel dates and destinations to the card issuing bank. By doing this, you can prevent your credit card from being flagged for suspicious activity.

“Providing your bank with advance notice also enables them to monitor your account more effectively and offer assistance in case of any issues or emergencies,” HDFC Bank said in its guidelines on preventing credit card misuse during overseas travel. If you are a frequent traveller, you can inform the credit card issuer in advance. This way, there will be no need to inform you about your travel plans every time.

Set limits on your credit card usage

You have to set a limit on the total amount that can be used on your credit card during international travel. This will substantially reduce the risks of losses arising out of fraudulent transactions. You can also set up text alerts as it will provide real-time information on card usage.

“Whether it is a credit card or a debit card that you are using, setting up text alerts helps in warning you about any fraudulent transactions that are done from your cards. Transaction alerts will inform you about any suspicious activity,” Yes Bank said in its usage guidelines.

Use secure channels for making credit card payments

It is important to use secure payment channels while using credit cards to protect your financial information from being accessed by fraudsters. You should not carry out any transactions on public Wi-Fi networks or unsecured internet connections abroad as they can easily be compromised.

“Hackers looking to steal money might have set up a watch on Wi-Fi networks of hotels or other tourist destinations. Whenever possible, you should either use your mobile internet connection or refrain from making net banking transactions on Wi-Fi,” Yes Bank said. “Furthermore, a Wi-Fi hack can also result in data theft or identity theft in future that may land you in big trouble,” the bank said.

You can use VPNs (Virtual Private Networks) to encrypt data as it will increase online security. You can also use banking apps or websites that offer two-factor authentication (2FA) for extra protection. A 2FA will require additional authentication such as a unique code sent to your mobile number in addition to user name and password.

Turn off credit card for international transactions post travel

If you want to keep your credit card secure, you have to disable international transactions on it immediately after your return from your foreign trip. You can do this by logging into the mobile banking app or through net banking. You can navigate to the ‘card controls’, ‘manage card transactions’ or similar sections and then disable the card for international transactions. You can enable the card for overseas transactions again when you travel abroad the next time. You can also block the card and get a replacement card, which will not cost much.

If you think that developed countries are more immune from cybercrimes that include credit card fraud, then think again. China, US and UK rank among the top-10 in the ‘World Cybercrime Index’. Incidentally, several developed countries do not follow 2FA for credit card transactions.

You do not have to enter the PIN for PoS (Point of Sale) transactions or OTP (One time password) for online transactions in many countries. If someone gets information about your credit card number, expiry date and CVV (Card Verification Value), then she/he can easily carry out online transactions. So, you have to be extra careful while using your card in foreign countries.

To further take control of your credit card usage, you can use credit card rules such as the 2 3 4 rule. This will will help you in keeping your credit utilisation ratio in check.

What is the 2-3-4 rule for credit cards?

The 2-3-4 rule for credit cards simply suggests applying for no more than 2 credit cards per month, 3 cards in 90 days, and 4 cards per year to maintain a healthy credit score and avoid rejection from banks.

This is important because when you will not make many credit card applications in a very short period of time, then the lending institutions will never see you as over-reliant on debt. 

Furthermore, it is not just about the 2-3-4 rule that must be carefully followed. There is also the golden rule of credit card usage that must be kept in mind while using these credit instruments.

The golden rule simply instructs credit card users to pay credit card bills on time every month. This is done to avoid interest building, maintaining credit score and financial discipline. Hence, by following these simple rules and keeping composure credit card users can make the most of their credit instruments abroad. 

Allirajan M is a journalist with over two decades of experience. He has worked with several leading media organisations in the country and has been writing on mutual funds for nearly 16 years.

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