Decoding Payment Fraud: Skimming Vs. Shimming Explained


I’ve seen too many individuals fall victim to payment fraud. Whether it be skimming or shimming, these tactics are becoming increasingly sophisticated and difficult to catch. That’s why it’s crucial to understand the differences between these two types of fraud and how to protect yourself from falling prey. In this article, we will decode payment fraud and explain the ins and outs of skimming and shimming. Don’t let your hard-earned money fall into the wrong hands – keep reading to learn more.

What is the difference between skimming and shimming?

Skimming and shimming are two different techniques used by fraudsters to steal credit card information. Although, both these methods have the same outcome

  • stolen data, they differ in their approach and execution.

    Here are the main differences between skimming and shimming:

  • Skimming involves attaching a device to the outside of a card reader, such as an ATM or gas pump, that captures the information stored on the magnetic stripe of a credit or debit card as it is swiped through the reader. The device is usually quite large and can be easily spotted if you know what to look for.
  • Shimming, on the other hand, involves inserting a small, paper-thin chip (known as a shim) that contains a microchip and memory storage into the card reader. Shimming is typically used to target chip-enabled cards. The shim is usually about the same size as a credit card and is almost impossible to detect.
  • Another key difference between skimming and shimming is that shimming targets chip-enabled cards, whereas skimming is targeted towards magnetic stripe cards. This is because chip-enabled cards are more secure and more difficult to skim.
  • Also, skimming is done before the transaction is processed, while shimming is done during the transaction. This means that the cardholder may not even be aware that their card’s information has been stolen until they check their bank statements and see unauthorized transactions.
  • Overall, both skimming and shimming are illegal activities used by criminals to obtain credit card information. While skimming involves attaching a device outside of the reader, shimming involves inserting a tiny device into the reader. So, it’s important to be vigilant and cautious while using your cards and to frequently check your account for any unusual activity.

    ???? Pro Tips:

    1. Skimming is the act of copying the information from your credit card’s magnetic stripe, while shimming is the process of installing a tiny device inside the card reader itself to read the chip’s data. Always be on the lookout for any suspicious devices or loose components around the card slot.

    2. It is always good practice to check your bank or credit card statements frequently and monitor for any unusual activities or charges, as this may indicate that your card has been skimmed or shimmed.

    3. Be wary of ATMs or card readers that are located in remote or less-frequented areas. Criminals may target these machines to install skimmers and shimmers, as they are less likely to be detected.

    4. Consider using contactless payment methods such as mobile wallets or smart cards, as they are more secure and less susceptible to skimming and shimming attacks.

    5. If you suspect that your card has been skimmed or shimmed, report it to your bank immediately and have your card blocked and replaced. The quicker you act, the less damage the criminals can do with the stolen data.

    Introduction to Credit Card Skimming and Shimming

    Credit card skimming and shimming are two common techniques used by fraudsters to steal credit card information. Skimming is a process by which criminals attach a device to a credit card reader, which captures and stores the card’s information when it is swiped. Shimming is a newer technique that involves inserting a small device known as a “shim” into the reader of a chip-enabled card. When the card is inserted into the reader, the shim records and stores its data.

    These techniques are a serious concern for both consumers and businesses. A successful skimming or shimming attack can lead to financial losses, identity theft, and fraud. In this article, we will explore the differences between skimming and shimming, and discuss steps that you can take to protect yourself against these types of attacks.

    Understanding How Credit Card Shimming Works

    Credit card shimming works by inserting a tiny device known as a shim into the reader of a card. Shims are incredibly small and discrete, making them difficult to detect. When a chip-enabled card is placed in the reader, the shim intercepts and stores the card’s data, including the cardholder’s name, account number, and expiration date.

    Unlike skimmers, which were typically attached to the outside of a card reader, shims are inserted directly into the reader itself. This makes it much more challenging to detect and prevent shimming attacks.

    Recognizing the Difference Between Skimmers and Shims

    One of the key differences between skimmers and shims is their appearance. Skimmers are typically large and bulky, and can be attached to the outside of a card reader. Shims, on the other hand, are incredibly small and can be difficult to see.

    Another difference is the way that the data is captured. Skimmers read the magnetic stripe on the back of a credit card, while shims record the data from the chip on the front of the card.

    Both skimming and shimming can be used to steal credit card information, but they differ in their methods and degree of success. Shimming is typically more successful than skimming, as it is more difficult to detect and prevent.

    Identifying the Risks Associated with Credit Card Shimming

    Credit card shimming poses several risks to both consumers and businesses. For consumers, the primary risk is financial loss. If a fraudster gains access to your credit card information, they can use it to make unauthorized purchases and drain your account.

    Another risk is identity theft. With access to your credit card information, fraudsters can steal your identity and open new accounts in your name. This can be damaging to your credit score, making it more difficult to obtain loans or credit in the future.

    For businesses, the risks associated with credit card shimming are similar. A successful attack can lead to financial losses and damage to the company’s reputation. In addition, businesses may be held responsible for any fraudulent charges made using stolen credit card information.

    Factors that Make Shimming a Growing Cyber Threat

    There are several factors that make credit card shimming a growing cyber threat. One of the primary factors is the increasing use of chip-enabled credit cards. While chip cards are more secure than magnetic stripe cards, they are not immune to fraud.

    Another factor is the ease with which shimming attacks can be carried out. Unlike skimming, which often required physical access to the card reader, shimming can be done remotely. This makes it easier for fraudsters to carry out attacks on a larger scale.

    Finally, the increasing trend towards online shopping and contactless payments has created new opportunities for fraudsters. While chip cards have made in-person transactions more secure, they do not provide the same level of protection for online transactions.

    Steps for Protecting Yourself Against Credit Card Shimming

    Protecting yourself against credit card shimming requires a combination of vigilance and awareness. Below are some steps that you can take to reduce your risk of falling victim to a shimming attack:

    Check the card reader: Before inserting your card, take a moment to inspect the card reader. Look for any signs of tampering, such as loose parts or unusual attachments.

    Use trusted ATMs and card readers: Stick to ATMs and card readers that you trust, such as those at your bank or a reputable retailer.

    Cover the keypad: When entering your PIN, cover the keypad with your hand to prevent anyone from seeing it.

    Monitor your account: Regularly check your credit card statements for any unauthorized or suspicious charges.

    Use chip-enabled cards: Whenever possible, use chip-enabled cards for in-person transactions.

    Be cautious with online transactions: When making purchases online, only use trusted and secure websites. Avoid entering your credit card information on sites that you are not familiar with.

    In conclusion, credit card shimming is a growing cyber threat that requires vigilance and awareness on the part of both consumers and businesses. By understanding how shimming works and taking steps to protect yourself, you can reduce your risk of falling victim to this type of attack.