Collaboration is Key to Success in War against Credit Card Fraud

A survey of bank and law enforcement officials from across 18 markets in Asia Pacific found that an overwhelming 82% of the respondents attribute the historically low levels of card fraud to collaboration among member banks, law enforcement agencies, merchants, regulators, cardholders and payment card companies.

Visa Asia Pacific and its member banks have worked closely with the industry, regulators and police to drive down card fraud levels in the region to their historical lowest. Card fraud has dropped to three cents for every US$100 spent in Asia Pacific, compared with seven cents globally.

Among the other attributes for the successes in the fight against fraud were technology solutions, stronger legislation and increasing public awareness.

“Given the importance of collaboration in ensuring security in the payment system, all participants must take their roles seriously. If for instance, merchants or processors do not protect cardholder data according to industry standards, their defences are lowered; they become easy targets, and when attacked, stand to lose their customers trust in their business. We need to stay vigilant and step up our collective efforts,” said Peter Maher, Visa Asia Pacific’s general manager for risk management.

The survey was conducted at the recent Visa Asia Pacific Risk Management Conference in Singapore, which focused on creating a more secure transactional environment and ensuring the security of cardholders. The survey identified what the law enforcement and bank officials thought were the key concerns and the best solutions in risk management.

Highlights of the survey results include:

- 82% of the respondents stated that collaborative efforts have been effective in the fight against fraud. These respondents were mainly from the markets which had high awareness of EMV chip: Taiwan, Singapore and Malaysia (Visa Asia Pacific’s Heart of Smart Chip Consumer Research 2005 which found that in these three markets, smart cards are already making strong inroads with consumers.)

- A mature EMV chip card environment was cited as the best solution for counterfeit challenges.

- Counterfeit fraud, account information/data theft and reputation of an organization were listed as their top three security concerns.

When asked how they could play a stronger role in ensuring consumer confidence by driving down fraud, the respondents listed education and more collaborative effort. One law enforcement official said, “The Visa Asia Pacific Risk Management Conference is exemplary of the initiatives that are needed. It not only facilitates the sharing of information but also intensifies cooperation and encourages key stakeholders to work collaboratively in the war against fraud.”

The two-day conference addressed topics on the future of payment, protection of cardholder data, EMV migration, card crime investigation and merchant best practices.

See other recent news regarding: Visa, Credit Cards