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BI Calls for Improved Credit-Card Security
Dion Bisara | June 08, 2011

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Bank Indonesia has called on banks to improve their customer service in their credit-card business and provide more information to help clients avoid fraud.

Central bank deputy governor Muliaman Hadad said the lack of information for the public, particularly regarding how to maintain card security, was a central cause of credit-card fraud.

“BI want banks to concentrate on fraud and its early warning system by improving their customer service,” Muliaman said at a seminar on Wednesday.

“Education for the public is very important. That way, they will be more careful in using their credit card.”

Hotman Simbolon, Citibank vice president and head of the bank’s customer care center, said it welcomed the central bank’s request and said banks were trying to improve their customer service.

Customers can also help banks, he said, by keeping their personal information up to date. “Most of the complaints we have received were related to non-updated data,” Hotman said.

Hotman said that because of non-updated addresses, for example, credit-card information could be received by other parties who could assume the identity of the card holder and commit fraud.

Central bank data showed identity theft was the top avenue to credit-card fraud. According to BI, there were 1,204 cases of identity theft through April this year that resulted in a total loss of Rp 5.963 billion ($700,000).

In the first four months this year, there were 2,741 overall credit-card fraud cases with total losses of Rp 11.8 billion. Last year, there were 18,122 cases with total losses of Rp 55.2 billion.

Bank Indonesia is drafting new regulations on credit cards that will require banks to conduct periodic evaluations of credit-card holders, including verifying their personal data. It will also require banks to provide transaction alerts for their customers.

It will set a minimum age and income for card holders, the maximum number of cards a person can hold and other new rules.