We are only liable for max RM250 after credit card lost or stolen

Do you know that pursuant to Sections 19 and 26 of the Banking and Financial Institutions Act 1989, Bank Negara (Central Bank of Malaysia) has issued a Credit Card Guidelines in March 2003 to all credit card issuers. The Guidelines were intended to promote active consumerism and consumers’ understanding of credit card usage and protecting their interest as card users.

Any party who fails to comply with the guidelines may be found guilty of an offense punishable under Section 104 of the Act.

Here is what inside the guidelines say:

• Clause 13.2: "the cardholder's maximum liability for unauthorised transactions as a consequence of a lost or stolen credit card shall be confined to a limit specified by the issuer of the credit card, which shall not exceed RM250, provided the cardholder has not acted fraudently or has not failed to inform the issuer of the credit card as soon as is reasonably practicable, after having found that his credit card is lost or stolen."
• Clause 13.3: "where the amount imposed on the cardholder for unauthorised transactions due to loss or theft of the credit card is in excess of the maximum liability limit, the issuer has to prove that the cardholder has acted fraudently or failed to inform it as soon as reasonably practicable of the loss."
• Clause 13.4: "the issuer shall ensure that the cardholder is not held liable for any unauthorised transactions charged to the credit card after he/she has notified the issuer verbally or in writing. The issuer shall take imediate action upon notification by the cardholder to prevent further use of the lost of stolen credit card."

In layman terms, it means that if your credit card is lost or stolen, and you informed the bank immediately, the bank has to suspend your credit card at once. You are only liable to a maximum of RM250 caused by unauthorised use of credit card after you found out your card was lost/stolen and before you report it to your bank. If the bank wants to charge for more than that, they need to prove that you were negligent in handling your credit card and/or didn't report the lost/stolen immediately. Once you've made the report to the bank, either by phone or by fax or any other means, you are no longer liable for any amount charged to your credit card thereafter.

You should remember this information to protect your rights and benefits, just in case (touch wood!) anything bad happened to your credit cards.