Discover has decided to end its “Secure Online Account Numbers” program, which offered disposable debit card numbers for safer online shopping. This service, which helped customers who were hesitant to use their real card details online, was discontinued on September 8, and Discover notified customers via email.
Reports from media sources such as The Consumerist and the Chicago Tribune suggest that the reason for stopping the program is the introduction of advanced security measures that protect against fraudulent card usage, both in-person and online. As a result, Discover no longer sees the need for disposable debit card numbers.
While Discover has stopped its program, it wasn’t the first to offer such a service. American Express started a similar program in 2000, and Discover, Citibank, MBNA, and others followed suit. Even after MBNA was bought by Bank of America, their “ShopSafe” feature is still available for worried customers. Citibank also continues to run its Virtual Account Number program.
Customers who use these security features are right to be concerned, as credit card and identity fraud are still major issues, especially with online transactions. Javelin Strategy & Research reports that although the number of fraud cases dropped in 2010, the financial risk has gone up. Annual fraud costs fell from $56 billion to $36 billion, but consumer expenses increased by about 63%. Javelin credits this decrease to better consumer awareness and stronger security measures by credit card companies.
In its email, Discover reassured customers that they are always protected with $0 Fraud Liability, meaning they are not responsible for unauthorized purchases, whether online or offline. This allows customers to use their cards with confidence, knowing they are covered at all times.