21 August 2017
Find out more

Small businesses criticise bank chip and PIN programme

27 May 2003  |  5045 views  |  0 Small businesses criticise bank chip and PIN programme

The Federation of Small Businesses has called on the UK banking industry to keep independent traders up-to-speed with the chip and PIN migration timetable and to do more to protect against cardholder-not-present fraud.

UK banks and high street retailers are currently testing a new chip and PIN payment system in Northampton, in which cardholders replace signature authorisation for purchases by punching in a four digit code at the point-of-sale.

The new credit cards will be introduced nationwide by 2005 and businesses that do not have the requsite point-of-sale pinpads will become liable in the event of fraud.

The FSB is concerned that many small firms are still in the dark about the plans.

John Walker, FSB policy chairman says: "Businesses that rent their terminals from a bank should be okay but others could face substantial costs upgrading to the new system. In many cases they know nothing about these plans. We are calling on the banks to do more to promote chip and PIN in the coming months."

Walker is also concerned that whilst chip and PIN will help combat the use of stolen and counterfeit cards it will not tackle cardholder-not-present fraud, where the sale takes place over the Internet or telephone.

He says: "Cardholder-not-present crime is a big growth area for fraudsters and shot up by 15% last year. There is a real danger that as chip and PIN takes off, fraudsters will just use the Internet and telephone instead. Chip and PIN cards are a great leap forward but the banks need to do much more to combat cardholder not present fraud."

Credit card fraud accounted for losses of £424m in 2001 of which £110m was the result of cardholder-not-present fraud.
KeywordsEFTPOS

Comments: (0)

Comment on this story (membership required)

Finextra news in your inbox

For Finextra's free daily newsletter, breaking news flashes and weekly jobs board: sign up now

Related stories

Northampton chip and PIN trials kick off

Northampton chip and PIN trials kick off

19 May 2003  |  3370 views  |  0 comments
Banks set date for chip and PIN trial as card fraud soars

Banks set date for chip and PIN trial as card fraud soars

11 April 2003  |  4156 views  |  0 comments

Related blogs

Create a blog about this story (membership required)
visit www.vasco.comdownload the paper nowvisit www.abe-eba.eu

Who is commenting?

A Finextra member Finextra Member Commented on: Real-time payments in...
A Finextra member Finextra Member Commented on: Barclays uses sensors...

Top topics

Most viewed Most shared
Mobile contactless spending accelerating in UKMobile contactless spending accelerating i...
11607 views comments | 26 tweets | 23 linkedin
Barclays pairs banking data with third party apps for SmartBusiness DashboardBarclays pairs banking data with third par...
9936 views comments | 22 tweets | 31 linkedin
hands typing furiouslyWhy Is Risk Analytics Important?
9693 views 0 | 5 tweets | 1 linkedin
Norwegian banks and startups form fintech clusterNorwegian banks and startups form fintech...
9400 views comments | 19 tweets | 23 linkedin
RBS to bring Silicon Valley to EdinburghRBS to bring Silicon Valley to Edinburgh
9366 views comments | 10 tweets | 8 linkedin

Featured job

Find your next job