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Automated online payment tech helping to combat card fraud

Apr 21 2019 13:12
Lameez Omarjee, Fin24

Automated EFT payments enabled by technology from fintech company Ozow may be a secure alternative method to transact than card payments.

Last week the Ombudsman of Banking Services released data for the first quarter of the year, showing that credit card fraud had spiked from 12.2% to 19.47%, in just three months.

Individuals fall victim to fraud when scammers obtain their credit card information and conduct transactions without the knowledge of the account holder.

But Adesh Kisten, Chief Commercial Officer of Ozow, previously known as i-Pay, said that consumers could take another measure of protection through the use of automated EFT to transact.

Over the past four and half years that Ozow has been operating, no cases of fraud have been reported, Kisten told Fin24 by phone on Friday.

"Ozow provides an automated EFT payment mechanism to help people make payments and to help merchants receive payments. We facilitate the transfer of funds from the consumer bank account directly to the merchant bank account," he said.

This is different to a manual EFT payment, in that it is less onerous. Consumers do not have to wait for the merchant to provide their banking details, then list the merchant as a beneficiary before they can make the payment, and then provide proof of the payment.

"Ozow allows for the payment to take place in 13 seconds or less – this is generally faster than other automated EFT providers on the market", said Kisten.

Kisten said that the six major banks are offered by Ozow for payments, and Ozow is available from numerous merchants including Vodacom, online retailers Takealot, Superbalist and Loot, among others.

Ozow is looking to partner with airlines in the coming months and is rolling out an international expansion strategy – starting first with the African continent and then moving further ashore, Kisten said.

It is a safe alternative to card payments in that the card details - the 16-digit number on the front, the CVV number on the back and the expiry date - are often clearly visible and can be obtained and used by fraudsters to make unauthorised payments.

"When you make a purchase over the phone and share your credit card details with the person on the other side, this increases the risk of credit card fraud," Kisten explained.

"With Ozow, you use your internet banking username and password. And you still authorise your payment through your bank’s security mechanisms such as the one-time-password/PIN(OTP) or in-app authorisation," Kisten said.

Unlike other online payment methods such as inserting card information on the merchant's website, who then transfers the information to the bank to authorise the payment, Ozow cuts out the merchant in between, which streamlines the process.

Kisten added that consumers should be careful with sharing their online banking details such as their login information and passwords. Individuals should take care to only use well-known, trusted payment platform, he said.

online banking  |  credit card fraud  |  fraud
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