Consumer protection against unauthorized use of credit cards in Malaysia: A banking law perspective

摘要

Plastic cards have invaded the monetary market as a payment instrument used to purchase goods and services. There are several types of plastic cards in the circulation namely, credit cards, debit cards, charge cards, stored value cards and smart cards. The first credit card used to eliminate the need to carry cash was the Mobil Oil, USA card issued in 1914 and the first form of charge card was the Diners card, which was used by businessmen in the 1950's to purchase meals on an expense account. Since then, a variety of cards have been introduced to customers that have a multitude of functions for their daily transactional needs. The numbersudof individuals that rely on cards have increased from year to year and presently the plastic card has become an indispensable instrument in the money wallet. Among all the different types of plastic cards, the most favoured by customers is the credit card. Statistics provided byudBank Negara Malaysia indicate that as at August 2007, principal card holders number 8.22 million; supplementary card holders' number 1.15 million; and in August 2007 the number of credit card transactions using (local and foreign) credit cards totaled 20.21 million.2 The credit card appears to be the most favourite plastic card among Malaysians. However, the downside of owning the credit card is the danger of it being used by unauthorized third partiesudto illegally purchase goods/services or to withdraw moneys/credit advances from the automated teller machine. Is the consumer protected from incurring the liability of such illegal transactions? The writer will discuss the extent of legal protection afforded by banking laws In protecting innocent bank customers from being burdened with illegal transactions conducted in his name.