Card-not-present fraud keeps increasing

Trends in fraud on payment cards in Australia are sticking to the script. Fraud is rising on credit cards and scheme debit, and falling on Eftpos. The chief culprit in the rising trend is card-not-present fraud.

Banks and payments industry bodies say the trends are as expected, and they continue to promote education of merchants and consumers as the chief antidote to the problem.

The Australian Payments Clearing Association yesterday published half-yearly data on fraud levels, which shows fraud averaged across all types of Australian-issued payment cards has increased from 33.3 cents to 35.6 cents in every $1000 transacted.

APCA said that total card-not-present fraud (though internet, phone and mail-order purchases) increased by 38 per cent.

Skimming fraud dropped by 14.5 per cent, APCA said, largely because of the roll-out of chip technology for payments terminals and credit cards.

APCA put fraud on credit cards at 62.8 cents per $1000 in the second half of 2010. The average value of each fraudulent transaction was $237, two-thirds the level of three years ago.

Aggregate credit card fraud of A$328 million in 2010 accounted for 80 per cent of $412 million in fraud on all payments' instruments monitored by APCA in 2010.

Fraud on Eftpos dipped in the second half of 2010, to 7.86 cents per $1000, after rising in the first half of the year.

One quirk in the data is that the average value of cheque fraud is rising, to $14,600, double the average of three years ago.