Online fraud rises as 3-D Secure remains unpopular

Online retailers could be losing over half a billion pounds in fraud according to a new report by prepaid card provider 3V and industry body the Interactive Media in Retail Group (IMRG).

A survey of the IMRG's members conducted last month found that over a third said they had experienced a marked increase in online fraud since the introduction of chip and PIN on the high street.

But while 64 percent of respondents said they are increasing their anti-fraud measures, over half stated that they have no plans to introduce the 3-D Secure initiative – Verified by Visa or MasterCard SecureCode – because customers find it hard to sign-up to the systems.

"The increase in online fraud is directly attributable to chip and pin success on the high street," argued 3V's chief executive Kieron Guilfoyle. " Two-factor authentication is critical in reducing fraud; it's difficult enough getting customers to make a purchase in the first place without breaking their journey by making [them sign up to 3-D Secure]."

See also:

Barclays set for chip and PIN device roll-out

Over half a million devices will be sent out to users of its online banking service  19 Apr 2007

Apacs responds to chip and Pin scare

Banking association investigates warning that consumers could be duped  08 Jan 2007

Chip and Pin deemed a success

Card users generally happy with security technology  16 Nov 2006

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