Fraud issue lies in credit cards
(19 May 2009 – Australia) The latest data on payments fraud by The Australian Payments Clearing Association (APCA) shows that fraud is increasingly a credit card issue.
Fraud over the 2008 calendar year increased for credit cards in Australia according to the APCA data, with fraud for the increasingly comparable debit card decreasing over the year.
Cheques and debit cards are much safer when it comes to fraud, with fraud rates at just 0.9 cents and 6.6 cents in ever $1000 respectively.
Credit and charge card fraud (that is, signature permitted and card-not-present) increased from 44.7 cents (2007) to 53.2 cents in every $1,000. This means that the incidence of credit card fraud has risen from 18.6 (2007) to 21.8 in every 100,000 transactions.
APCA said that there were two primary reasons for the increase in credit card fraud. The increases in Australia’s credit and charge card fraud were driven by increases in Card-not-present (CNP) fraud and Counterfeit/Skimming, which continued to trend upward in 2008.
Further, APCA said that in preventing CNP fraud, financial institutions and card schemes are working with merchants to implement an added layer of security for online transactions to better verify the cardholder’s identity through measures such as MasterCard SecureCode and Verified by Visa.
Australia’s best defence against counterfeit cards is to join the international move to fraud resistant chip cards and chip reading terminals. Within the next three years the vast majority of consumer card transactions in Australia will use chip-based authentication, APCA added.
Despite the rise in credit card fraud in Australia, fraud levels are still some way behind those experienced in Britain, where cards are more prevalent. At 32 cents in every $1,000, Australia’s totalled debit card, credit card and charge card fraud rate is about a third of the UK’s which was the equivalent $1.12 in every $1,000 for the same period.
Cheques and debit cards are much safer when it comes to fraud, with fraud rates at just 0.9 cents and 6.6 cents in ever $1000 respectively.
Credit and charge card fraud (that is, signature permitted and card-not-present) increased from 44.7 cents (2007) to 53.2 cents in every $1,000. This means that the incidence of credit card fraud has risen from 18.6 (2007) to 21.8 in every 100,000 transactions.
APCA said that there were two primary reasons for the increase in credit card fraud. The increases in Australia’s credit and charge card fraud were driven by increases in Card-not-present (CNP) fraud and Counterfeit/Skimming, which continued to trend upward in 2008.
Further, APCA said that in preventing CNP fraud, financial institutions and card schemes are working with merchants to implement an added layer of security for online transactions to better verify the cardholder’s identity through measures such as MasterCard SecureCode and Verified by Visa.
Australia’s best defence against counterfeit cards is to join the international move to fraud resistant chip cards and chip reading terminals. Within the next three years the vast majority of consumer card transactions in Australia will use chip-based authentication, APCA added.
Despite the rise in credit card fraud in Australia, fraud levels are still some way behind those experienced in Britain, where cards are more prevalent. At 32 cents in every $1,000, Australia’s totalled debit card, credit card and charge card fraud rate is about a third of the UK’s which was the equivalent $1.12 in every $1,000 for the same period.
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