Japan Net Bank Ltd. recently launched a service called “one-time debit” to combat growing online card fraud, the Tokyo-based Internet bank said recently.
Through the service, Japan Net Bank accountholders receive a one-time-use Visa card number that is valid for 10 days. They may use the number at most of online stores globally that accept Visa, according to the bank, which automatically transfers the payment from the user’s account. Customers may use each card number to spend up to 100,000 yen (US$1,120 or 830 euros).
Not everyone is convinced the virtual card will provide adequate security. While the service innovative, there still is no guarantee payments will be safe, contends Kei Shimda, CEO of Tokyo-based research firm Infinita Inc, tells PaymentsSource.
“The payment is simultaneous with the transaction, meaning it won’t be an automatic withdrawal at month end as with most transactions on credit cards and bank accounts,” he says. “So even if there is an event where the transaction is a forged one, it may delay the timing in which users realize of the fraudulent transaction.”
Both JNB and Visa were not able to comment by PaymentsSource deadline.
Japan Net promises to compensate card users up to 5 million yen for fraudulent transactions reported within 30 days off the incident occurring, but this is a far shorter period compared with credit cards that allow up to 60 days to report fraud, according to Shimda.
In Japan, the perception of online payment is still negative because consumers tend to worry about safety, despite the country having high standards in online-payment technology, Shimada says.
Founded in 2000, Japan Net had total assets worth 51.6 billion yen as of the end September, up 22.6% from 42.1 billion same time in 2008, according to the bank.
