Changes on Loss Card Liability - FAQs

  • Card Liability-FAQsCard Liability-FAQs

    All your questions answered

On 4 September 2009, The Association of Banks in Singapore (ABS) announced new measures aimed at providing clarity and giving credit cardmembers more certainty about their credit card liability for unauthorized transactions.

In line with these measures, all credit card issuing banks in Singapore have agreed to revise their Cardmembers Agreement to reflect a new S$100 liability cap before the loss is reported by cardmembers. However, the liability cap is only applicable to cardmembers who had not acted fraudulently or with negligence or had not failed to report the loss of card in a timely manner.

UOB’s current practices, where thorough investigations are conducted to determine responsibility and liability for unauthorized charges, are already aligned with some of the changes announced by ABS. The Bank will also continue to safeguard our cardmembers’ interests through our fraud detection systems and alert our cardmembers to any high risk and suspicious transactions.

The new Cardmembers Agreement will be effective on 1 November 2009.

Here are some answers to frequently asked questions (FAQs) for your reference.

In the past, cardmembers could be held liable for any unauthorized transaction(s) effected prior to the Bank receiving a report on the loss or theft of their credit card(s).

With the revision, cardmembers’ liability for unauthorized charge(s) incurred prior to reporting would be capped at S$100. However, this is subject to the following conditions where a cardmember:

  1. has not acted fraudulently
  2. was not grossly negligent or
  3. has not failed to notify the Bank promptly of his lost or stolen card(s)

He will be fully liable for all unauthorized transactions or his credit card limit (whichever is lower). These would also include any interests and late charges that may be levied on those transactions.

The following are three examples of a “grossly negligent” cardmember:

  1. A cardmember places her handbag containing her wallet and credit cards on a chair in a busy restaurant. She leaves her belongings unattended to go to the rest room. Upon her return, she discovers that her handbag is stolen along with her credit cards. The culprit uses them to make a purchase at different shops. She is grossly negligent in leaving her handbag containing her credit cards unattended
  2. A cardmember writes the PIN to his credit card on a piece of paper and places it in his wallet. His wallet is stolen and the credit card is used for unauthorized withdrawals at ATM. The cardmember is grossly negligent in disclosing his PIN
  3. A cardmember leaves his credit card with the cashier at the pub for payment before he leaves the pub. Someone steals his card and fraudulently makes several charges on the card whilst the cardmember is in the pub. The cardmember is grossly negligent in leaving his card with a third party

The following are some examples:

  1. A cardmember leaves his wallet containing his credit card in the gym’s locker. Someone breaks the locker and steals his wallet. The culprit uses the credit card during the two hours that the cardmember is in the gym. The cardmember is not deemed to be grossly negligent and will be liable up to S$100
  2. A cardmember is on vacation, and his house is burgled and his credit card stolen. His maximum liability for unauthorized transactions will be capped at S$100 even if he returned some months later to discover the break-in
  3. A cardmember is pick-pocketed while overseas. When he discovers the theft, he immediately reports the matter to the local police and also calls his family member to report the theft of his credit card to the Bank on his behalf. His maximum liability for unauthorized transactions will be S$100

Yes. The Bank will review each reported case and may consider waiving the S$100 liability, especially in cases where the investigations reveal that the cardmember has been a victim of crime.

A cardmember will not be liable as long as he has not acted fraudulently or with gross negligence. This applies to transactions made online or over telephone where the physical card is not presented.

The Bank reserves the right to terminate the card(s) as well as pursue litigation to recover the amount. However, if the culprit is arrested and the goods are recovered or if restitution is made to the Bank, the cardmember’s liability will be waived.

We strongly urge cardmembers to exercise care and diligence in safeguarding their credit cards as though they are cash. They must immediately notify the Bank via our 24/7 hotline as soon as they are aware that their card(s) or card information have been lost, stolen or compromised. Cardmembers are also required to co-operate by providing information/documents to assist in any investigation carried out to determine the responsibility and liability of the unauthorized charges.

There is no stipulated timeframe as the cardmember is expected to notify the Bank at the earliest opportunity. If he fails to do so, he is deemed to be grossly negligent and will be liable for all unauthorized charges.

As a general guide, where investigations subsequently reveal that the cardmember has not acted fraudulently or with gross negligence, his liability will be limited to S$100.

The Bank is required to continue to safeguard and protect cardmembers’ interests through robust fraud detection systems to monitor and detect unusual/suspicious card activities. All such transactions will be reviewed for fraud analysts to contact the affected cardmembers for validation.

Merchants should ensure that their frontline staff perform basic checks such as gender and signature verifications when processing payments.

Under the Merchant Agreement with the Bank, if the merchant believes there is a discrepancy in the signature, the merchant is required to contact the merchant’s acquiring bank for instructions before completing the transaction.

Yes, the Bank may hold the merchant liable for fraudulent transactions due to his negligence. Merchants are required to make basic checks such as signature and gender verifications to ensure that the credit card belongs to the customer. If the merchant feels that the customer is behaving suspiciously, it is also required to ask for other forms of identification.