New figures from APACS show that while chip and pin has been successful in reducing offline fraud, online incidents have increased.Total card fraud losses have fallen from £439 million in 2005 to £428 million last year, but online banking fraud has increased from £23.2 million to £33.5 million in the same period.
Scammers foiled by chip and pin have moved into card-holder-not-present fraud online or via phone, or have continued cloning old-style magnetic strip cards for use in non-chip and pin countries outside Europe, according to the UK payments association.
"Fighting fraud is never going to succeed with a single-layered approach," Sandra Quinn, director of communications at APACS. "It requires different sectors - including public and private - to work together on developing and implementing strategies, sharing best practice and, most importantly, sharing data."
Industry experts have greeted the results as a step in the right direction. Stephen Cox, Principal security consultant at CA (pictured) said: "These results show the investment in chip and pin is working. I believe the key to increased security online is two-way authentication, where both the business and the consumer have to identify themselves."
However, it seems that some institutions need to go back to basics first. Eleven of the top names in banking, including HBOS, Alliance & Leicester, Nationwide, NatWest and Barclays, as well as the Post Office, were slammed by the Information Commissioner's Office last month for throwing customer's personal information into bins outside their branches. According to reports, the ICO has required them to sign a formal undertaking to comply with the principles of the Data Protection Act.