Visa UK has put out a call to action for home shopping retailers to look at their vulnerability to credit card security or face a huge increase in losses.
According to Visa, card-not-present (CNP) fraud - where the retailer never sees the card, but receives details by phone, online or by mail - constitutes 30 per cent of card fraud and is set to rise to 40 per cent by 2007.
As store-based retailers upgrade to Chip and PIN transactions, organised fraudsters are likely to migrate to CNP transactions. Visa said fraudsters' focus will not be on Internet shopping, but mail order and telephone transactions.
'We seem to be finding solutions for face-to-face fraud, but we shouldn't forget that fraudsters use other means,' said Visa UK managing director Colin Grannell. 'CNP fraud is bound to grow, unless new measures are put in place. We've done a lot to address card-present fraud with Chip and PIN. Having shut the door at one end, we don't want to leave it open at the back,' he said. 'Acquirers need to be saying to retailers, 'this is what you need to do when you take orders over the phone and by mail.'
Visa is offering two services that combat CNP fraud. CVV2 gives retailers the opportunity to verify card details using a second unique number on the back of the card.
Additionally, the Address Verification Service checks the card holder's billing address through the numerics of the their postcode.