Credit card invention could stamp out fraud

A year after chip and pin was launched to cut credit card fraud, a new invention has the potential to tackle the crime further.



Since chip and pin was introduced, figures show that total credit card fraud has fallen by five per cent, yet consumers are still affected by card-not-present (CNP) fraud, which affects purchases made remotely over the internet or telephone.

CNP credit card fraud cost the UK £95.3 million in 2006, but pioneering new technology could protect customers and revolutionise the payment card market, according to moneysupermarket.com.

Head of credit cards at the price comparison site Robert Kenley said that a new solution, still in initial trials, would see banks issuing credit card readers to each customer.

Mr Kenley said: "When someone wants to purchase something remotely, they would simply place their card into the reader and type in their pin. The card reader would then generate a one off pass code which would be communicated to the retailer to verify the transaction."

However, in the meantime, consumers should stay secure by using secure sites which are protected by Verified by Visa and MasterCard SecureCode and by using a credit card for purchases, as cardholders are not normally liable for fraud, he advised.

© See Terms and Conditions