Holders of Misused Payment Cards Indemnified

Owing to the NBS activities, banks returned RSD 17,205,831 to the holders of payment cards that were misused (mainly in January–June 2023) in global payment apps. As the NBS explained, a total of 288 holders were indemnified (including those who did not file a complaint with the NBS), so an average amount of RSD 59,742 per holder was returned.

– This excludes the amounts previously returned by banks from merchants in the complaint procedure, as this is the amount charged to banks. In addition to the return of most of the funds, through the above NBS supervisory activities, banks are obliged to implement measures to prevent and/or reduce the risk of such misuse of payment instruments. In late June 2023, the NBS warned citizens of a particular form of fraud, which has been on the rise since early this year and implies receiving a text message from an unknown phone number, with holders invited to access the merchant’s website via the given link and to make a payment or update their user information – the National Bank of Serbia (NBS) emphasizes in its press release and explains that, believing they have visited the official website of the merchant whose services they use or have used before, holders enter card data, including a one-time password for payment.

– The criminals controlling such fake websites use the information to store the person’s card in their digital wallets, making several transactions before the holder becomes aware of the fraud and blocks the card. Procedures held under holders’ complaints established that there was indeed gross negligence on the part of holders, and according to the rules in the Law on Payment Services this should result in holders shouldering the entire loss thus incurred; however, the NBS did not stop there and instead it made additional efforts to compensate the holders for the most part – the NBS says.

In regard to this, as part of its supervisory activities, the NBS demanded that the banks cover the entire amount of losses incurred due to fraud suffered by card holders, with the exception of the loss from the first transaction, given that even without the digital wallet service in global payment apps, holders would have suffered this loss due to their gross negligence.

In addition to duly applying the Law on Payment Services, by allocating fraud-incurred losses in this way the NBS wanted to apply the principle under which banks have to bear at least some risk for the products they offer, while at the same time point out that negligence cannot be an excuse to fully absolve holders from their responsibility.

Narodna banka Srbije Beograd

National Bank of Serbia

NBS

payment cards

digital payment

passwords

website

data access

money

data misuse

payment services