Credit Card Debts: Causes and Prevention

Credit card is any card that may be used repeatedly to borrow money or buy products and services on credit. It is issued by banks, savings and loans, retail stores, and other businesses. It has been found that there are many people who have been relying on their credit cards too much and are now in debt.

The CAUSES of credit card debts are as follow:

Missing payments

Many credit card users only pay the interest and the minimum amount of principal when the debt is due and never fully repaying the entire sum. Thus, the debt accumulates and increases via interest. Finally, the card users are unable to pay the debt.

Overspending

The prices of goods and services going up and not the income, but people still keep on spending as much as they got used to regardless of the reduced income. Thus, they will spend beyond their earnings. They choose to use credit card to purchase goods and services and to cover basic living expenses. However, they may found difficulties or unable to pay back the amount.

Having too Many Credit Cards

The more credit cards a person has, the more likely they are to use them. For example, a credit card holder will has more credit limit if he or she holding more than one card.

Gambling

Gambling is fun and entertaining but if it becomes addictive it'll be hard to stop. This won't become a problem if people spend their extra money for gambling. But borrowing money through the credit cards for gambling will surely lead the card users to a financial disaster.

The PREVENTATIONS of credit card debts are as follow:

Good Money Management

A monthly spending plan is essential. Without that, people have no idea where their money is going. Planning is no more difficult than writing down the expenses and income and reconciling the two. This will enable them to see clearly where their money goes. Besides, people should adjust their expenses based on their new income.

The smart card holder only spends what they can afford. They only use credit card when they are sure that they can pay the balance off at the end of the month.

Prioritize Debt Repayment

Credit card users are advisable to pay off their debts to get rid of the highest interest payment first. List all of your credit card debts, and the amount paying each month. Pay off the lowest amount first. Then use that money to start paying off the second lowest amount.

Cut Up the Extra Credit Cards

Pick the one with the lowest interest rate and cut up the rest. The one that been kept should be deemed an ‘emergency card.” Just use one or two cards and use them as a financial tool. Remember that a credit card is not the same as free money.

Get Professional Help

There are plenty of debt consolidation firms offering to help, but do bear in mind these companies ultimately make money from a card holder’s debt. There are four main agencies that offer free, impartial advice for those in debt: the Citizens Advice Bureau, the Consumer Credit Counselling Service, National Debtline, and Payplan. These are non-profit making organisations that guide those in debt through the options available to them.

It has been noted that it can be very difficult living without credit cards but a financial help site has acknowledged that they can also be very dangerous as many people are facing huge debts after using their card too often.

As a conclusion, credit cards should be used for emergencies only, unless people are plan on paying the entire balance off immediately.

References:

http://ezinearticles.com/?Why-Credit-Card-Abuse-Causes-So-Much-Debt&id=1018899

http://www.credit-land.com/articles/articles_page_68600_1881780_120.php

http://www.articlesbase.com/finance-articles/using-credit-cards-can-cause-debt-719910.html

http://www.insolvencyhelpline.co.uk/debt_special_situations/credit-card-debt.php

The application of pre-paid cash card for consumers.

What is the pre-paid cash card?

The prepaid card is far from a new idea. How many of us

 have used a

 prepaid gift card or a prepaid mobile phone SI

M card? The concept is basically the same. A prepaid card looks like a credit o

r debit card, and gives users the ability to p

urchase products and services with a card but with a crucial difference - you can only spend the balance that has been preloaded onto the card. This means there is no risk of running into debt as it has no credit or overdraft facility.

How do they work?

Money can be loaded on to a prepaid card by 

cash at a bank, Post Office, at Payzone or PayPoint terminals, bank transfer, through your employer or even by another credit card.
When using for purchasing at a high street store, they wo

rk in exactly the same way as a credit or debit card - you simply hand the card to the cashier. You will be asked to enter your PIN number (supplied with the card) on an electro

nic keypad or to sign a payment slip so your s

ignature can be matched with that on the back of the card (if ther

e is no Chip on the card). The total amount will be taken from your card immediately and the transaction is complete.
To shop online, you'll find the item you want to buy and click on to the website's "checkout" page before filling in your details and those of your prepaid card. As long as you have enough cash loaded on your card (the website checks this by the usual means of an author

ization), the purchase is completed and your item will be shipped to you.

What does it uses?

The prepaid card may be a relatively new idea, but it has no shortage of uses, including:

• Buying groceries and petrol• As a replacement for travellers cheques or travel cash for a low cost   alternative to paying  for goods and services abroad
• Topping up your mobile phone• Internet shopping including eBay• Paying bills
• Transferring money to friends and family either in the UK or overseas (known as r

emittance)

• Withdrawing cash from an ATM

They have particular appeal to those including

• People who wish to use foreign currency on a h

oliday• Newly arrived immigrant, who although earning, cannot yet obtain credit due to having no credit footprint in the UK

• A person who has a poor credit rating or a history of bad debt who cannot get a credit card
• Parent of a young person travelling abroad.

Who provide the pre-paid cash card service?

As we know the 2 giant of credit card issuing co

mpany Visa and Master a ready provide this kind service. They also pro

vide other card such as General Purpose Cards, Gift Cards, Travel Cards, payroll car

ds and etc, to fulfill difference customer need. 

(*click image for the link)

In Malaysia, pre-paid cash card a ready have quite long history. But it start popular in this few years.

There are few bank or company providing this kind service, they are as follow:

• Bank Islam Card -i
  

• Maybank Visa Debit Card
  

• PB VISA ELECTRON
  

• Ambank NexG
  

• tunemoney
  

 

Reference:

http://www.moneysupermarket.com/cards/prepaid-cards-guide1.asp

http://usa.visa.com/personal/cards/prepaid/index.html

http://www.mastercard.com/us/personal/en/aboutourcards/gift_prepaid/

Phishing : Examples and Its Preventation Methods

What is Phishing?

A phishing technique was described in detail in 1987, and the first recorded use of the term "phishing" was made in 1996.

Phishing or Web Forgery is the criminally fraudulent process of attempting to get information such as usernames, passwords and credit card details by masquerading as a trustworthy entity in an electronic communication.

Phishing is typically carried out using email or an instant message. It often directs users to enter details at a fake website whose look and feel are almost identical to the legitimate one.

The following is an example of what a phishing scam e-mail message might look like:

Example of a phishing e-mail message including a deceptive URL address that linking to a scam Web site. To make these phishing e-mail messages look even more legitimate, the scam artists may place a link in them that appears to go to the legitimate Web site (1), but it actually takes the users to a phony scam site (2) or possibly a pop-up window that looks exactly like the official site.

Here are some of the Phishing Examples:

PayPal

PayPal is an online payment solution provider. We can receive funds and pay for products and services that we purchase on the web through PayPal.

In an example PayPal phish, spelling mistakes in the e-mail and the presence of an IP address in the link (visible in the tooltip under the yellow box) are both clues that this is a phishing attempt.

Another clue is the lack of a personal greeting. A legitimate PayPal communication will always greet the user with his or her real name, but not just with a generic greeting like, "Dear Accountholder."

eBay

This genuine looking email is a masquerade. When the receivers clicked on “respond”, they were directed to an exact clone of eBay and the personal information was stolen. These messages come in different styles and writings.

To prevent this, go manually to ebay.com and checkout the private messages whether real or not.

How to Prevent Phishing?

Here are some of the Phishing Preventation Methods：

Train People to Recognize Phishing Attempts

One strategy for combating phishing is to train people to recognize phishing attempts, and to deal with them. One newer phishing tactic, known as spear phishing, has been harnessed to train individuals at various locations.

People can take steps to avoid phishing attempts by slightly modifying their browsing habits. When contacted about an account needing to be "verified", it is a sensible precaution to contact the company from which the e-mail apparently originates to check that the e-mail is legitimate.

Never Enter the Personal Information in a Pop-up Screen

Legitimate companies, agencies and organizations don’t ask for personal information via pop-up screens. If the users enter the information in a pop-up-screen, the information will go to the phisher. To help prevent this type of phishing attack, the users can install pop-up blocking software.

Protect Computer with Spam Filters, Phishing Filter, Anti-virus and Anti-spyware software, and a Firewall, and Keep Them Up to Date

A spam filter can help reduce the number of phishing emails you get. The spam filter product comparisons are available in the website: http://spam-filter-review.toptenreviews.com/

Anti-virus software and anti-spyware software, can protect the users against pharming and other techniques that phishers use.

Firewalls prevent hackers and unauthorized communications from entering the users' computer–which is especially important if the users have a broadband connection because the users' computer is open to the Internet whenever it’s turned on.

Only Open Email Attachments that are Expected and Know What They Contain

Even if the messages look like they came from people you know, they could be from scammers and contain programs that will steal your personal information.

Phishing and Malware Protection
Phishing and Malware Protection helps to keep the user safe online. These features will warn the users when they visit a page that has been reported as a Phishing pages or Web Forgery of a legitimate site.

For example, Internet Explorer 7 introduces a new notification area called the Security Status Bar. If a web site is a known phishing site the Address Bar turns red, and the Security Status Bar will appear.

References：

http://en.wikipedia.org/wiki/Phishing#Phishing_techniques

http://www.bustathief.com/what-is-phishing-ebay-phishing-examples/

http://www.microsoft.com/athome/security/email/phishing.mspx?ifs=0

http://www.mozilla.com/en-US/firefox/phishing-protection/

http://www.fraud.org/tips/internet/phishing.htm

http://www.ie-vista.com/phishing.html

The application of 3rd party certification programme in Malaysia.

MSTrustgate.com Sdn Bhd is a licensed Certification Authority (CA) operating within the Multimedia Super Corridor. MSC Trustgate wa incorporated in 1999 to meet the growing need for secure open network communications and become the catalyst for the growth of e-commerce, both locally and across the ASEAN region. At present, MSC Trustgate has 12 million in paid up capital.

Trustgate is licensed under the Digital Signature Act 1997 (DSA), a Malaysia law that sets a global precedent for the mandate of a CA. As a CA, Trustgate’s core business is to provide digital certification services, including digital certificates, cryptographic products, and software development. They are committed to provide the finest Public Key Infrastructure (PKI) to assist all types of companies and institutions conducting their business over the Internet. The state of the art back-end infrastructure that costs RM 14 million is one of the best in the region.

Vision

Security is the primary concern of entering into the new Internet economy. The ever-changing paradigm of e-commerce requires a well-mandated security infrastructure. The vision of Trustgate is clear:

“To enable organizations to conduct their business ecurely over the Internet, as much as what they have been enjoying in the physical world.”

MSTrustgate offer complete security solutions and leading trust services that are needed by individuals, enterprises, government, and e-commerce service providers using digital certificates, digital signatures, encryption and decryption.

Products and services provided by MSTrustgate as follow:

1. SSL Certificate
2. Managed Public Key Infrastructure (MPKI)
   
3. Digital ID for Secure Transactions, Documents & E-mails
   
4. MyTRUST for Mobile Signature
   
5. MyKad PKI (MyKey)
   
6. SSL Virtual Private Network (SSL VPN)
   
7. Managed Security Services
   
8. Verisign Certified Training
   
9. Application Development and System Integration
   
10. Repository

Why do we need the ceritfication???

It an attachment to an electronic message used for security purposes. The most common use of a digital certificate is to verify that a user sending a message is who he or she claims to be, and to provide the receiver with the means to encode a reply.

An individual wishing to send an encrypted message applies for a digital certificate from a Certificate Authority(CA). The CA issues an encrypted digital certificate containing the applicant's public key and a variety of other identification information. The CA makes its own public key readily available through print publicity or perhaps on the internet.

The recipient of an encrypted message uses the CA's public key to decode the digital certificate attached to the message, verifies it as issued by the CA and then obtains the sender's public key and identification information held within the certificate. With this information, the recipient can send an encrypted reply.

The most widely used standard for digital certificates is X.509.

Related Links:

• http://www.msctrustgate.com/
  
• http://java.sun.com/j2se/1.5.0/docs/guide/security/cert3.html
  
• http://www.verisign.com/ssl/ssl-information-center/index.html?sl=t72880167000000002&set=e077381&gclid=CIeT_v37zpgCFRcJbwodBDw-1w