Looking out for credit card holders amid rise in fraud

With the number of complaints about unauthorized credit card transactions and losses continuing to rise the Hong Kong Monetary Authority is exploring measures to enhance customer protection, including credit limits for online transactions.

The authority has put forward eight preliminary proposals on measures to better protect of credit card holders, The Standard's sister paper Sing Tao Daily says.

The proposals take in banks improving communications with clients, allowing customers to set credit limits for different categories, providing risk education, treating clients equally, promoting borrowing obligations, strengthening control over certain transactions, enhancing fraud monitoring and collaborating with other stakeholders such as Visa and Mastercard.

The HKMA suggests that customers should have more autonomy and participation in adjusting credit card limits. The authority hopes banks will allow their customers to set a separate sublimit for different types of transactions, such as online transactions, gaming and e-sports transactions.

Many complaints have been related to one-time passwords. Some customers have questioned about why such passwords are handed out via phones and also on them having to bear the loss of unauthorized transactions.

Initial moves have included discussions with telecommunications companies on how to allow customers to obtain one-time password records to avoid disputes.

There are also suggestions on tightening controls on certain transactions and moving away from one-time passwords in favor of using mobile security codes for authentication.

The HKMA is also discussing people's concerns about how banks define "gross negligence" of credit cardholders and trying to establish a unified criteria.

Legislative Council member Ronick Chan Chun-ying, representing the finance functional constituency, suggested the monetary authority and banks should increase promotion on credit card users' personal privacy protection, set limits on high-risk or online transactions and enhance authorization control to avoid disputes.

On "gross negligence," he remarked, a court might need to intervene. But he welcomed the idea of the HKMA providing guidance based on actual cases.

Meantime, the authority is encouraging firms in the Greater Bay Area to make good use of Hong Kong's green finance platform.

That would include firms turning to the SAR for green financing.

Secretary for Financial Services and the Treasury Christopher Hui Ching-yu also said he will continue to promote Hong Kong's financial strengths at the annual meeting of the Asian Development Bank in South Korea next month.