The U.S. currently accounts for 47 percent of global credit and debit card fraud even though it generates only 27 percent of the total volume of purchases and cash, according to Global Card Fraud, from a recent issue of The Nilson Report.
Payment card fraud losses totaled $3.56 billion last year in the U.S. from all general purpose and private label, signature and PIN payment cards.
"The U.S. has a disproportionate percentage of the global total losses for two reasons. U.S. banks have been slow to adopt newer technologies such as EMV chip cards, and issuers are reluctant to decline card authorization from merchants because they don't want to alienate their cardholder," said David Robertson, publisher of The Nilson Report.
Banking institutions in Europe, Latin America, the Middle East, Africa and Asia, however, have adopted stricter security procedures inherent in payment cards with computerized chips, as well as the use of dual factor and dynamic authentication (one-time passwords) for cards-not-present transactions.
As a result, global card fraud worldwide as a percentage of total volume has actually decreased. In 2010, total fraud losses equaled 4.46c per $100 in total volume of purchases and cash, down from 4.71c per $100 in 2009.
Total global fraud losses, at $7.60 billion, however, increased in 2010 by 10.2 percent over the prior year because the rate of spending is outpacing losses. The payment card industry is expected to continue to grow sales volume at a faster pace than thieves can compromise the system.
For more information on this topic, visit our trends/statistics research center.
