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An article relating to this blog post on Finextra:

Visa teams with banks on alert system

Card network Visa is teaming with eight North American banks to pilot an automated alerting system that will notify cardholders of transaction activity via SMS text message and e-mail.

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Visa shows why it is on the decline. Sell, sell sell.

What form might the SMS take?

"Dear Sir/Madam, your card has been involved in a transaction, and because of our flawed and easily exploited transaction system we have notified you in case the inevitable has happened. This does not mean that this possible fraud will be among the .001% of such frauds investigated, or that we will not alter your profile to reflect the increased risk you pose to us by using our transaction system."

Closing the barn door after the horse has bolted.

"Information is power, especially when delivered in a timely manner,"says Elizabeth Buse, global head of product at Visa Inc.

- so what is timely about after the event? Have you actually thought about this?

"We are now empowering cardholders in this pilot with real-time transaction alerts."

- how are they 'empowered' exactly? More spin, have you been reading my site? Real time means during the transaction, not after it, and where is the mechanism for the customer to repudiate the transaction before the merchant is defrauded?

"Participating Visa cardholders can typically receive alerts before they walk out of the store, rather than hours or even days later."

- er excuse me but in the case of a fraud it isn't actually the customer who is in the store and the fraudster willl surely walk out as soon as they've ripped off the merchant.

"Dear Sir we fobbed off a dodgy gate to you and it has failed and your animals have escaped."

The difference is that the horses and cows can easily be seen and recaptured, however the Visa fraudster is a phantom and may be anywhere and is very unlikely to be caught, let alone prosecuted. The farmers would be smart enough to tell them where to put their product and I suspect it wouldn't be very sunny. What a load of old cobblers!

Who thought this one up, marketing?

What's the ROI on this?

I assume you'll only send an SMS after the snake oil salesman's best guess software has decided that the transaction may be a potentially fraudulent one, unless the customer has pre-set all the parameters?

Pray tell me how it will lead to less fraud? How will it lead to more convictions?

I don't understand the benefit for the customer here. It does not make them safer, it just means that they get the bad news sooner. Merchants are no better off either.

Of course there won't be anyone out there sending SMS's to your customers telling them that there have been (fraudulent) transactions on their accounts and cause a bit of a problem at the call centre when no-one knows anything about it. Ever heard of phishing? What is it called when you do it with SMS's? This will be a call centre nightmare, even without 'smisher's.

Clearly a sign of desperation and another flawed attempt to delay the inevitable.

I suggested to all my friends to buy when they listed and to sell back in June. It was a nice little earn thank you, (to the dummies who bought after that).

Visa. Book value $25. Short term price maybe $50 (until the rest of the shareholders wake up) with a steady decline to about $18.

Prove me wrong.


Comments: (1)

David Birch
David Birch - Tomorrow's Transactions - London 20 August, 2008, 10:52Be the first to give this comment the thumbs up 0 likes

I think you've misunderstood how the system might work.  In other, more advanced economies (eg, Lebanon, Hungary) you get a text message whenever your card is used for transactions above a certain threshold.

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