Credit Card Fraud – An ever growing reality

By: Anthony Samuel | Posted: 26th July 2007

Credit cards are the favorite means of consumer payments. The credit card payment mode involves the exchange of sensitive financial information. This has led to the growth of credit card fraud which has troubled nearly all countries in every part of the globe. Moreover, the recent expansion in technology related crimes has increased the cleverness of people to obtain personal information on the Internet. A report published in the US in 2002, shows that over 60% of online adults in US do not do business through the web because they fear for their financial security and privacy is at risk. The report further informed that over 70% of Americans are very worried about the risk of online purchases and are afraid that someone might steal their credit card numbers and other personal information during the transaction process. Indicators are pointing that online credit card security concerns are extremely genuine and they thwart a huge proportion of users from using this expertise to buy products and services over the Internet.

The trepidation seems to be reasonable as for as credit card fraud goes. The Ipsos-Insight survey did a research in which 12% of respondents said they have been the victims of credit card fraud. Nearly 27.3 million Americans have been victims of credit card fraud in the form of theft in the last five years. Credit card fraud is turning out to be a shocking phenomenon all across the globe. Only in the year 2004, credit card fraud cost to US merchants a staggering 2,664.9 million dollars. For the last year or so, reports have shown that credit card fraud is a significant problem in Canada, too. A good number credit card frauds are still being committed using lost, stolen or counterfeit cards.

In UK, the situation is precarious as credit card fraud reached nearly 400 millions pounds in 2002 and it further rose by 18% to 478.8 millions pounds between June 2003 and June 2004. The whopping amount of 30 millions pounds increase in fraudulent cash machine withdrawals accounts for a major portion of the overall rise in fraud. With the implementation of some stringent measures, the overall credit card fraud in Britain fell by 3 percent from 2005 to 2006, to ï¿½428 million. The drop off in overall fraud is exclusively owing to the beginning of a security measure in 2006 which necessitates cardholders to identify themselves at the point of sale through a personal identification number, or PIN.

The cases related to credit card fraud would have been of more amount, had some of them not been averted timely. While transacting fraud cases, the overall rejected orders of total about comes at 70-80% on all worldwide internet transactions over the period of a year. Nearly 50% attempts have been dismantled in the U.S., Australia, Canada, and British Isles & Western Europe. The orders from countries in some eastern European countries have averted nearly 100% such cases. These percentages might fluctuate from industry to industry and merchant to merchant. To combat the credit card fraud and to boost online credit card usage, credit-card companies typically limit customer liability to only $50. Some even limit none at all. Now with the advent of new technologies, the credit card fraud dilemma is going to be reduced to increase online transaction.

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This article was brought to you courtesy of Anthony Samuel, the webmaster of http://www.apply-for-a-credit-card-now.com. A credit card directory where you can search, compare and apply for credit card offers from leading credit card companies as well as find tools and credit card articles to help you choose the right credit card. This article is free for republishing
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Tags: phenomenon, credit cards, credit card fraud, credit card numbers, financial security, respondents, proportion, financial information, trepidation, credit card payment, million dollars, withdrawals, security concerns, cleverness, payment mode, credit card security