Chip
and PIN, which allows shoppers to verify purchases at point of sale
by keying a four-digit PIN instead of signing on paper, was
launched last year to tackle the growing problem of credit and
debit card fraud.
It became operational on 1st January and, according to APACS, is
already having an effect, reducing the losses suffered by banks as
a result of counterfeit or lost and stolen plastic cards. Figures
obtained by the industry association show that UK banks lost £36
million less between January to June 2005 than in the same period
last year, when it cost them £126.6 million.
Counterfeit card fraud has fallen 31%, while lost and stolen
card fraud has dropped 27%, says APACS.
The figures do not cover other types of card fraud, such as
identity fraud, mail non-receipt and card-not-present fraud.
Half-year figures for these will be published next month.
The scheme is now moving into the final phase of its roll-out,
with 14th February 2006 set as the deadline by which cardholders
must be able to remember their PINs to make payments with their
chip and PIN cards.
There will still be the odd instance in which cardholders will
continue to sign after that date – for example, where purchases are
made in outlets that are not yet using the chip and PIN technology,
or using cards that have not yet been upgraded – but these will be
the exception, rather than the rule.
“The vast majority of people are already successfully using
PIN,” said Sandra Quinn of the Chip and PIN programme.
“Ninety-seven percent of transactions on chip and PIN debit cards
and 89% of transactions on chip and PIN credit cards are already
successfully verified by PIN.”
The programme has launched the “I ♥ PIN” campaign to target the
minority of customers who have chip and PIN cards, but are not yet
using their PIN number.
