Tue, 22 Jan 2008

Why Credit Card Type?

So, why is it that, whenever we're asked for our credit card on some Internet commerce site, we're also asked for the type of the credit card? That makes no sense to me, because the first digit of the credit card reliably identifies it as an amex (3), visa(4), mastercard(5), or whatever. Are they asking us this information in order to eliminate fraud? And yet it can't be a secret amongst fraudsters to look at the first digit.

I speculate that the cost of the time wasted by everyone having to enter the type of the credit card exceeds the value of the fraud prevented. But notice who pays for those costs. The first cost is paid by the consumer. The second cost is paid by the credit-card company. Even if the cost is small, it still makes sense to push that cost off to the consumer.

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