Better technology driving credit card fraud down: ECB

Jul 25, 2012
Improved technology has driven down credit card fraud in Europe dramatically, the European Central Bank said Wednesday in its first-ever report on the issue.

Improved technology has driven down credit card fraud in Europe dramatically, the European Central Bank said Wednesday in its first-ever report on the issue.

"Card fraud has been on a declining trend since 2007 ... have been key to increasing the security of transactions," the central bank said.

The ECB analysed fraud in card payments in 32 and calculated that it dropped to 1.26 billion euros ($1.53 billion) in 2010, a 12.1-percent dip from the previous year.

Fraud took place in 0.040 percent of all credit card transactions in 2010, down from 0.045 percent in 2007, the central bank added.

The total amount of fraud increased by 0.7 percent between 2007 and 2010 but the value of transactions vastly outstripped this over the same period, rising by 5.1 percent to around three trillion euros per year.

The most important improvement to credit card technology identified by the ECB was the introduction of a chip-based standard called EMV.

"This offers stronger than conventional magnetic strips both for the physical card ... and for the technological infrastructure behind the transaction," said the ECB.

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SDrapak
not rated yet Jul 25, 2012
From what I've heard much of the fraud has moved to the US, where cards with chips are not being strongly promoted and most cards are still just the easily duplicated mag stripe only. You have to wonder if the card companies will reduce their interest rates if fraud rates are coming down.