EMV Predictions For 2016: Chip Cards Will Lead To Record Increase In Online Fraud

By Thomas Tesmer, COO, JetPay Payment Services

If you think the adoption of EMV chip card technology will drastically eliminate all credit card fraud, think again. Fraudsters have bills to pay just like the rest of us, and they won’t easily give up. Look for them to take their criminal activities online in record numbers for 2016 and beyond.

Based on the EMV experience in Europe, U.S. card not present (CNP) online retailers should act now to brace themselves for an onslaught of fraud as EMV chip card technology becomes more widely adopted, greatly reducing the number of opportunities for in-person fraud and forcing thieves to focus their efforts online.

The European Experience

Europe has been paving the way for EMV chip card technology for almost a decade. The transition provides U.S. retailers with a looking glass into the future of how EMV chip cards will lower fraud in the brick-and-mortar retail world, but will create a greater risk to unprotected CNP retailers.

Prior to implementing EMV chip card technology, brick-and-mortar retail fraud in the United Kingdom was at an all-time high, reaching more than $328 million a year. After transitioning to the new chip card technology, credit and debit fraud in the U.K. decreased 70 percent to just over $108 million.

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