Online fraud surges after EMV chip cards hit the US
Thanks to the chip card, in-store transactions are now much more secure. But that’s pushing fraudsters to more earnestly target online retailers, at dramatically amped-up rates.
The effect is easy to see by comparing online fraud growth in the U.S. – where chip cards were rolled out largely in 2016 – versus fraud rates across the global marketplace. That data was released Nov. 22 by ACI Worldwide.
While the total number of global online transactions increased 13 percent from 2015 to 2016, the percent of fraudulent transactions grew slightly less, at 12 percent. In contrast, a 12 percent growth in U.S. online transactions over the previous year was dwarfed by a 43 percent gain in fraud attempts.
Still, online fraud rates in the U.S. are much lower than the global average, at just under 1 percent of transactions in 2015 versus over 2 percent globally. But given the U.S. surge in online fraud in 2016, that gap is narrowing, with the U.S. rate now standing at 1.27 percent of transactions.
ACI Worldwide, a global electronic payments processor, analyzes its year-over-year data from payments made to 125 retailers that utilize its ReD Shield service.
See related: As online fraud spikes, here's how to safeguard your accounts, 8 FAQs about EMV chip credit cards, Infographic: EMV chip card rollout in US to peak in 2016, More infographics
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