Has Chip And Pin Been Successful?

Valentine's Day marked the second year since the change over to chip and pin, the new credit card payment system, was introduced in the UK. But has this form of payment that replaced signing for credit card transactions proved to be to a success in the fight against credit card fraud?

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According to APACS, the UK's payment association, chip and pin cards have in fact reduced fraud in shops but that alone is not enough for us to sit back and drop our guard.

In a statement Sandra Quinn, director of communications for APACS said, "The main aim of chip and pin was to reduce fraud in shops and it has succeeded since the cost fell from £218 million in 2004 to £72 million in 2006."

The first half of 2007 also saw a decrease in fraud on lost and stolen cards as it dropped by some 15%. Today it is now almost impossible to use a credit card without a PIN in most retail establishments and shopping centres within the UK.

However APACS warned that internet fraud and both telephone and mail order fraud are still on the increase, rising by 44% last year.

Ms Quinn added, "Criminals, like all of us, are using the internet more and more. There are protections in place that help to minimise problems but until all internet retailers around the world adopt the latest systems and practices and understand how to keep our payment data safely, there will always be problems."

In many cases criminals will copy data from stolen cards and use them in countries which have not yet adopted any form of credit card protection. Therefore it is crucial that we keep our account information and PINs as private and out of sight as possible.

Another form of fraud which is on the increase is that of identity fraud. Here organised fraud criminals somehow manage to get their hands on personal data such as bank account details, credit card numbers, addresses, names and dates of birth. Such information is then used to impersonate innocent people by either taking over their existing accounts or setting up a new one and running up tremendous debts until the whistle is blown. As a result your credit rating can be ruined and take several months to resolve.

However, identity fraud is now becoming increasingly difficult for fraudsters, as UK credit card companies are taking the necessary steps to constantly update and improve their fraud protection techniques.

It is therefore extremely important that we are prepared to take some of the most basic precautions in order to help fight card theft and identity fraud. It is absolutely fundamental that we keep all our credit cards and personal data safe whether we are at home, abroad or shopping online.

One of the main precautions we can take is to regularly check our credit reports. This will allow us to spot any suspicious activity such as credit card applications or new bank accounts that we know we did not set up. Straightaway contact can be made with the lender and problems can be nipped in the bud before they spiral out of control.


Other crime preventative methods include:

  • Never write down your Pins or passwords and leave them lying around.
  • Keep PINs and credit cards separate.
  • Do not reveal personal financial details with anyone.
  • Check bills and statements carefully for any suspicious transactions.
  • Shred financial documents and statements before throwing them away.
  • Avoid carrying items around with you if you aren't going to need them such as passports, driving licences and even credit cards.
  • Never give away bank, card or personal details such as your age, date of birth or mother's maiden name to cold callers or in response to unsolicited e-mails.
  • Redirect your post when you move home and always report missing post to the post office in case it is being intercepted.
  • Register on the electoral roll at your current address in order to prevent fraudsters from impersonating you.
  • Report any thefts to the police and suspicious transactions on your accounts to your bank or card issuer.

Obtaining regular credit reports is not only an effective method in fraud victim prevention, it is also recommended by the Home Office. Experian is Britain's largest credit reference agency.

Published on February 15, 2008