Fraud losses incurred by banks and merchants on all credit, debit, and prepaid general purpose and private label payment cards issued worldwide reached $16.31 billion last year when global card volume totaled $28.844 trillion. This means that for every $100 in volume, 5.65¢ was fraudulent.

In the US, which is edgeing toward the introduction of the global chip card standard, fraud losses equaled 12.75¢ for every $100 in total volume last year. Fraud in all other regions combined was only 3.73¢ per $100.

“Multiple factors contributed to that gap,” says David Robertson, publisher of The Nilson Report. “Nothing mattered more than the lack of an EMV-compliant infrastructure.”

EMV technology provides protection against losses from counterfeit cards, which accounted for 49% of all card fraud losses worldwide last year. US issuers were slammed by losses due to counterfeiting, fueled by data centre breaches that made available tens of millions of stolen card account numbers as well as personal cardholder identification information. US issuer losses due to counterfeiting of $3.89 billion last year accounted for 23.9% of all global fraud losses.

Europe’s issuers were also hit because criminals skimmed the magnetic stripes from the backs of cards to generate fraud on counterfeit cards they created for use at US merchants, says The Report.

Of the total $16.31 billion lost to fraud last year, card issuers worldwide absorbed 62%. Merchants accounted for the other 38%. In the US, card issuers lost $4.91 billion and merchants lost $2.95 billion before other costs are factored in.

The introduction of EMV, while stemming losses from counterfeit fraud, will likely lead to a surge in card-not-present fraudulent transactions over the telephone and on the Web. For 2015 through 2020, Nilson is forecasting a continued surge in losses to $183.29 billion. In 2020, global card fraud will likely exceed $35.54 billion, says the company.