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What if you could ‘turn off’ your cards?

By Jeanine Skowronski ·
Tuesday, May 13, 2014
Posted: 4 pm ET

Ever wish you could turn off your credit or debit cards? A few companies are launching solutions that allow you to do just that in an effort to combat card fraud.

Card Control, a mobile app from software company Ondot Systems, give cardholders the ability to turn their credit and/or debit cards "on" and "off" with a finger swish. It also allows them to set limits by dollar amount, location or shopping category. Limits can be set on secondary accounts as well. So, parents, for example, could make sure their college student spends funds at their university's bookstore instead of, say, the local mall.

"The basic idea is to give consumers control over when, where and how their cards can be used," Vaduvur Bharghavan, CEO of Ondot Systems, explains.

Another service, Red Giant, locks a prepaid debit card when it's not in use. Customers unlock their card via a mobile app when they're about to make a purchase. They receive instant receipts, balance statements and information on spending goals at the point of sale. They also receive alerts if someone tries to make a transaction on the locked card.

Ondot Systems and Red Giant are marketing their technology to financial firms. The Red Giant prepaid debit card is also available directly to consumers, by invitation only, on its website. There's currently a $4.95 monthly fee for the service.

Following last year's massive Target data breach, these platforms are likely to appeal to issuers, since they're the ones generally on the hook for fraudulent charges.

However, "the actual liability to consumers is low," says James Wester, research director of global payments at IDC, so it could be difficult to "sell them on tools based upon them being worried" about card fraud.

Also, neither app can protect users from identity theft, should hackers get ahold of personal information via a retailers' database (ahem, Target).

But Robert Sears, CEO of Red Giant Inc., believes consumers benefit directly from having more control over their accounts. For instance, users wouldn't have to go through the hassle of disputing charges with their financial firm or wait to have money returned to a compromised bank account, since the service would preclude hackers from draining it.

"We can't prevent (fraud) from happening," Sears says. "But we can prevent it from being so painful."

Would you use a service that allows you to shut off your debit and/or credit cards? Let us know in the comments below!

Follow me on Twitter: @JeanineSko.

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jared lake
May 14, 2014 at 10:53 am

I pay in gold and use a

May 14, 2014 at 9:52 am

Bank of America already has been doing this for free for years shopesafe feature