Chip and pin has proved a decisive success in its first full year of operation, payment services company Apacs has claimed.
Credit and debit card losses to fraud are down by £65 million, or 24 per cent on 2004, to £439 million reports Apacs.
Mail non-receipt fraud saw the most dramatic declines, falling 45 per cent year-year, followed by counterfeit scams involving skimmed and cloned cards with a 25 per cent drop.
The only area that continued to see rising levels of fraud was ‘card not present’ fraud involving payments online or over the phone, where chip technology cannot be used.
The next step in security will be chip readers in phones, suggests Apacs, able to compare credit card details with the number provided.
Even here however, the rate of increase has fallen for the first time since 2003, partially due to other security checks such as a second security number on the signature strip, greater use of address details for verification and systems such as SecureCode.
“Seeing card fraud losses come down is cast-iron proof that chip and pin is doing its job,” said Sandra Quinn of Apacs.
“Back in 2002 we forecast that fraud would have risen to £800 million in 2005 if we didn’t make the move to chip and pin so it’s heartening to see total losses well beneath this figure.”
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