Visa New App May Help to Cut Down Fraud

Visa New App May Help to Cut Down Fraud

Visa, the payment company is planning to launch a new application that will help its cardholders to notify their banks that where they are automatically utilizing the location function available in almost every smartphone.

Privacy experts are appreciating the feature and they said that if it is used in a correct way, it might protect cardholders and could also reduce on credit card fraud. Credit and debit card fraud costs consumers and banks billions of dollars every year. This figure has been increasing because data breaches have become more frequent.

According to the Federal Reserve, in 2013, the US banking industry has reported $1.57 billion in debit card fraud and $4 billion in credit card fraud in 2012. By experiencing these high costs, banks and the payment processors have been increasing their efforts so that they can reduce fraud.

According to Jamie Dimon, the CEO of JPMorgan Chase, his banks pays $250 million overall on cybersecurity every year and also planning to increase that spending. Beginning in April, banks are going to update their smartphone apps in order to add new location-tracking software of Visa.

"We will be able to compare the merchant's location to the most recent mobile phone location to show it's a less risky transaction", said Visa executive Mark Nelsen.