REUTERS

Financial losses from credit card fraud dropped by 36 percent this year compared to last year, the SA Banking Risk Information Centre (Sabric) said on Monday.

“Even more noteworthy is that the industry experienced this decrease, despite the high volumes of financial activity in our sector during the country’s hosting of the Fifa 2010 World Cup,” Sabric CEO Kalyani Pillay said in a statement.

“The banking industry’s financial losses resulting from credit card fraud have decreased by 36 percent, from R409,3-million, to R263,8-million.”

However, fraud on South African credit cards was on the increase in other countries.

“Most of the cross-border fraud is committed in the United Kingdom, USA, Australia, France and China.”

The primary card fraud category in the past three years had been card skimming, where the information on the card's magnetic strip was copied using a hand-held device.

The value of crime in this specific category decreased 32 percent, but still accounted for loses of R141,4-million this year.

“While significant progress has been made on this front, we now have to contend with a new era of skimming that involves devices mounted onto ATMs,” said Pillay.

“Although the usage of ATM-mounted skimming devices is not yet prevalent in most parts of the country, this trend is definitely of concern and the banks are already deploying various inter-bank strategies to ensure that customers do not fall victim.”

The fraudulent use of lost and stolen cards decreased by 60 percent in the past year.

“At the same time, false application fraud and account takeover fraud have decreased by 91 percent and 71 percent respectively.”

Pillay said this was probably because banks were consistently upgrading their security measures. - Sapa