Financial institutions and card schemes are actively working to tackle CNP fraud with a wide range of initiatives.
16 December 2016
The Australian Payments Clearing Association, the payments industry self-regulatory body, today released interim payments fraud statistics covering the 12 months to 30 June 2016.
The interim figures show that Australians spent $703 billion on their cards over the period – of this total 0.07%, or $521 million, was fraudulent. This represents a card fraud rate of 74.2 cents per $1,000 spent, up from 60.4 cents per $1,000 spent on the previous 12 months.
The rise in card fraud is driven by increasing card-not-present (CNP) fraud. CNP fraud occurs when card details are stolen and then used to make purchases or other payments without the card, mainly online.
Today’s figures show that CNP fraud increased from $323 million to $402 million over the 12 month period and accounted for 77% of all fraud on Australian cards.
APCA CEO Leila Fourie said, “Increasing CNP fraud reflects the growth in e-commerce and a global trend in online card fraud and cybercrime in general. Financial institutions and card schemes are actively working to tackle this fraud with a wide range of initiatives.”
Industry continues to progress the roll-out of significant measures including:
Improved cardholder authentication through one-time passwords and biometrics.
Reduced exposure of card data through tokenisation and adherence to global security standards for cards.
Fraud identification and prevention in real-time through dedicated analytics tools.
“We have been successful in reducing counterfeit and skimming fraud at point-of-sale terminals in Australia with chip technology. By using the online authentication and fraud detection technologies available, we can do the same in the CNP space,” said Dr Fourie.
“This year, we have also commissioned research on the impact of CNP fraud on consumers and the mitigation strategies taken in other jurisdictions, developed industry guidelines for implementing a range of fraud detection solutions, and are engaging with merchants to understand their needs and expectations,” said Dr Fourie.
Merchants can help protect their businesses and customers from online fraud by taking advantage of the tools available including fraud detection and online authentication solutions.
Consumers can take simple steps such as only providing their card details on secure websites and always keeping their PC security software up-to-date. Australians are not liable for any fraudulent transactions on their payment cards and will be reimbursed as long as they have taken due care.
The interim fraud data are consistent with trends described in Australian Payments Fraud – Details and Data for 2015, released by APCA in August 2016.
Today’s figures are available at www.apca.com.au. Comprehensive payments fraud data for 2016 will be released in mid-2017.
Media Contact: Ida Turner, APCA Communications Tel: (02) 9216 4817 Mob: 0409 716 556
Australian Payments Clearing Association Limited ABN 12 055 136 519
Level 6, 14 Martin Place, Sydney NSW 2000 Telephone +61 2 9216 4888 Facsimile +61 2 9221 8057 www.apca.com.au
Use a fully hosted payment gateway provider to collect your payments.
Watch for suspicious orders. Is the order unusually large for your business? Is the customer trying various cards in order to make a successful payment?
Avoid shipping re-saleable goods to a temporary address (e.g. hotel) or to a PO box number.
Never take payments on behalf of any other business or person.
Only make refunds to the card originally used to pay for the goods.
Take advantage of the tools available such as online authentication methods – American Express SafeKey, Mastercard SecureCode and Verified by Visa.
Always keep your PC security software up-to-date and do a full scan often.
Only provide your card details on secure websites - look for the locked padlock.
Register for, and use your financial institution’s online fraud prevention solutions whenever prompted.
Check your account statements and report any suspicious transactions to your financial institution.