Banks know all too well that there’s a need for them to sort online credit card fraud. So in line with this, they are currently looking at adopting a more high-tech approach to the problem. The approach being looked at would result in the security code of debit and credit cards changing every hour.
Such technology was last year unveiled in France, as part of an ongoing attempt to keep ahead of the online fraudsters. Now UK financial institutions are looking at the feasibility of doing the same.
New debit and credit cards would contain a mini screen which displays a random code that changes automatically every hour. Replacing the current printed three-digit security code on the back of the card.
The National Audit Office (NAO) encourages the development of such solutions in a recent report. Also, warns that police forces are not doing enough to tackle the growing threat of online fraud.
The NAO says, new cards with changing numbers would be “a positive step, as the re-design may help to stop an increase in online card fraud. However, such a plan would require all card providers to participate.”
The NAO said the issue was “not yet a priority” for all local police forces and the problem had been overlooked by the likes of the government, law enforcement and industry.
It is estimated that almost two million cyber-related fraud incidents were to have taken place within a year, therefore the cost is likely to run into billions of pounds, the NAO said.
Sir Amyas Morse NAO chief said: “For too long, as a low value but high volume crime, online fraud has been overlooked by the government, law enforcement as well as the industry itself.
“It is now the most commonly experienced crime in England and Wales and therefore demands an urgent response.”
He said the Home Office, while not solely responsible for tackling the issue, was the only organisation that could oversee the system and lead change.
The Home Office’s Joint Fraud Taskforce, launched in February 2016, was a positive step “but there is still much work to be done”, he said.
“At this stage it is hard to judge that the response to online fraud is proportionate, efficient or effective.”
The NAO report also indicates that the overall cost of all forms of fraud in 2016 was £10 billion to individuals and £144 billion as a whole to the private sector.
In the year to 30th September 2016, there were 1.9 million estimated incidents of cyber fraud, some 16% of all crime incidents.
The report said: “Fraud is now the most commonly experienced crime in England and Wales, is growing rapidly and demands an urgent response.
“Yet fraud is not a strategic priority for local police forces and the response from industry is uneven.”