[Gi Ha-young's Life Card] Do Not Lend Your Credit Card Under Your Name, Even to 'Family'

No Compensation for Fraudulent Use When Lending or Transferring Credit Cards
Transfers Not Allowed Among Family; "Get a Family Member Card"

[Asia Economy Reporter Ki Ha-young]Is there anyone these days without at least one credit card? In modern society, anyone can have a card if they want. Credit cards have brought unparalleled convenience to daily life. Now, wherever you go, you can easily see people paying with credit cards or smartphones. As demand has increased, cards with various benefits are being released almost daily. Accordingly, Asia Economy delivers various stories related to cards, which are inseparable from our consumer life, through the weekly 'Cards in Daily Life' corner, including introductions to new cards, behind-the-scenes industry stories, and guides for card beginners.

[Image source=Yonhap News]

Is it illegal to lend a credit card issued in your name to your parents or children? According to the Specialized Credit Finance Business Act, credit cards cannot be transferred or assigned, and violators may face imprisonment for up to one year (or a fine of up to 10 million KRW). In other words, even if it is family, lending a credit card is not allowed.

In particular, if fraudulent use occurs due to lending or transferring a credit card, compensation for damages cannot be claimed. Recently, there have been cases where victims were induced to pay others' taxes using their credit cards in exchange for a commission, only for the fraudsters to leave the card payment bills to the victims, so caution is needed.

The Financial Supervisory Service (FSS) issued a consumer alert last month regarding such credit card proxy payment fraud. According to the FSS, the criminals exploited the fact that third-party credit cards can be used to pay local taxes (acquisition and registration taxes) to commit crimes. They lured victims by promising a commission of about 2% of the card payment amount if they lent their credit cards for local tax payments, but then disappeared without depositing either the commission or the payment amount. The fraudsters paid the taxes for several months and reassured victims by depositing the payment amount and commission into their accounts before the card payment due date. However, after the fraudsters disappeared, the victims ended up bearing the payment amounts.

The FSS emphasized, "If fraudulent use occurs due to lending or transferring credit cards, compensation cannot be received," and advised, "If you lose your credit card or it is stolen, you must immediately report it to the card company."

If you lose your credit card or it is stolen, you must report the loss or request suspension of use to the card company as soon as you become aware. Delayed reporting after knowing the loss or theft may result in liability for fraudulent use.

By using the unified credit card loss report service, you can report the loss of all your credit cards through one card company. Also, if there is no intentional or gross negligence on the member’s part in case of loss or theft, the card company compensates for fraudulent use occurring after 60 days prior to the loss report date. Examples of intentional or gross negligence include fraudulent use due to the member’s intent, lending or transferring the card to others, leaking the password, or delaying the report without justifiable reason despite knowing the loss or theft.

You now understand well that even for family, lending a credit card is not allowed, right? If you need to lend a card to a family member, you can apply for a family member card (family card).