ANALYSIS OF PAYMENT CARDS FRAUD TRANSACTIONS AND MEASURES TO PREVENT THEM


Keywords: card payments, fraud management, fraud transactions, fraud mitigations, coefficient of correlation.

Abstract

Topicality. The trends of fraud and the history of fraud in general with the emergence of new gaps due to the rapid development of information technology is analysed in the article.
The systematization of types and forms of fraudulent intervention, their consequences and ways of counteraction taking into account the interests of users is made.
Aim and tasks. The causes of payment card fraud, the main forms and types of possible fraudulent transactions and areas of payment card fraud were further classified and investigated.
Research results. The investigation revealed the most common cases, including lost and stolen payment cards, counterfeit cards and fraudulent transactions without a payment card, and identified measures to combat them. At the same time, the ways of using different methods for the implementation of fraudulent transactions were analyzed. In the context of the rapid growth of e-commerce during the global pandemic, widespread fraud and steps to be taken against them have been revealed. Another noteworthy part of the research is the continuation of research in the language of numbers based on statistical data, as well as the collection and accuracy of statistical reporting.
Conclusion. Thus, first, the cases of fraud on payment card transactions in the European Union were disclosed, and then the correlation coefficient between payment transactions in the payment card market in the Republic of Azerbaijan and fraudulent transactions was calculated. An investigation was also conducted into the implementation of preventive measures against fraudulent transactions, which are important for financial institutions and payment service users, as well as and the steps to be taken in a consistent manner are explained in the article. The life cycle of payment cards is divided into three main stages, customer acceptance, identification and decision-making, the specific features of each stage and ways to prevent risks in these stages are noted in the article. In the end, the results of the research are reflected in the conclusion section of the article.

Author Biographies

KHAYALADDIN R. TAGHIYEV

P.h.D on economy,

senior researcher in Institute of Scientific Research on Economic Reforms
of Ministry of Economy of the Republic of Azerbaiijan
AZ 1011, H.Zardabi prospect, 88a, Baku Azerbaijan

TAMERLAN H. RUSTAMOV

Doctoral student, Institute of Scientific Research on Economic Reforms
of Ministry of Economy of the Republic of Azerbaiijan
AZ 1011, H.Zardabi prospect, 88a, Baku Azerbaijan
Deputy director at the Payment Systems Department, Bank of Baku OJSC,
Head of Payment systems and digital banking expert group Azerbaijan Banking Association.
AZ 1052, Agha Nemetulla, 219 (63\65) Baku, Azerbaijan

ARAZ A. HASANZADE

Payment Systems and Settlements Department
The Central Bank of the Republic of Azerbaijan
AZ1014, 32, R.Behbudov str., Baku, Azerbaijan

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Published
2021-06-20
How to Cite
TAGHIYEV, K. R., RUSTAMOV, T. H., & HASANZADE, A. A. (2021). ANALYSIS OF PAYMENT CARDS FRAUD TRANSACTIONS AND MEASURES TO PREVENT THEM. Economic Innovations, 23(2(79), 172-184. https://doi.org/https://doi.org/10.31520/ei.2021.23.2(79).172-184