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​Visa says new app will cut credit-card travel troubles

Fraud detection systems can lock accounts when people travel, but location-sensing smartphone software now can help approve a legitimate transaction.

Visa's service checks that a purchase transaction is happening in the same place the purchaser's smartphone. Being in the same spot reduces the likelihood of fraud.
Visa's service checks that a purchase transaction is happening in the same place the purchaser's smartphone. Being in the same spot reduces the likelihood of fraud. Visa

It's a common problem for people who travel: you're try to buy something far from home, but the credit card company won't approve the transaction because it fears your card was stolen.

New software running on your smartphone, though, should curtail the problem, according to payments processing giant Visa. Software called Visa Mobile Location Confirmation uses your mobile phone's ability to locate itself and verify that you're near where the card is being used. The idea is that the chances of a fraudulent transaction are a lot higher if the transaction takes place in a different location from the phone.

The software, supplied by a company called Finsphere, will be available through banking apps available to US customers starting in April, Visa said Thursday. It'll be an opt-in service, meaning that it won't work until people grant permission.

The service reveals how useful it is to have a general-purpose computing device tucked away in your pocket or purse. In addition to all the utility for email, navigation, photos, social networking and of course phone calls, smartphones also help can bolster security.

In addition to enabling services like Visa's, smartphones can help supply codes used for login or money transfer through an idea called dual-factor authentication. For example, you can set Gmail to require not just a password but also one of these authentication codes from a phone-based app. Because the codes are short-lived, a thief couldn't just write it down and use it in the future.

People can call their banks to tell them where and when they'll be traveling so credit card payment processors needn't reject transactions that seem suspicious but are legitimate. That's a hassle, though, and plenty of people don't bother.

Visa has been trying to make the process less difficult. Last year, it began offering an online mechanism for people to discuss their travel plans. It also introduced a service called Visa Travel Authorization Tag that gauges travel plans based on plane, train, and hotel purchases made with the credit card.

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