Interac® debit card fraud skimming losses plummet to lowest level on record
Losses down 73 per cent in last three years
Toronto, Ontario (March 5, 2013) – Interac Association reported today that Interac debit card fraud losses, as a result of skimming, are the lowest on record since 2003 – decreasing to $38.5 million in 2012 from a high of $142 million in 2009. This represents 0.012 per cent of domestic Interac debit card volume and the lowest volume of fraud losses since data were recorded in 2003. Further, the number of cardholders reimbursed fell to 93,800 in 2012 from 238,000 in 2009. Cardholders are protected from losses under the Interac Zero Liability Policy*.
“Our multi-layer strategy to fight debit card fraud is producing significant results and continues to reinforce strong confidence in the safety, soundness and security of the world-class Interac system,” said Caroline Hubberstey, Head, External Affairs for Interac Association and Acxsys Corporation. “The ongoing conversion to chip technology is a vital tactic in our fraud prevention strategy, which is supported by other core elements that are critical to our continued success. These include valuable partnerships with law enforcement, financial institutions, acquirers, merchants and educational outreach to consumers.”
Chip technology is both secure and smart. It gives the card the ability to store and process data securely. Unlike a magnetic stripe, this processing power makes it extremely difficult to copy and reproduce. This processing power is used, together with cryptography, to allow the card and terminal to communicate with one another to carry out security checks to ensure the card is valid. Chip technology also enables advancements like Interac FlashTM, which is currently being rolled out across the country.
While there are different security methods that can be used to secure cards enabled with contactless technology and the associated transactions, Interac Flash only leverages secure chip processing, instead of magnetic stripe data type processing. This protects Interac Flash against skimming, counterfeiting, and transaction replay types of fraud, including electronic pick-pocketing where readers are used to capture information.
“As an enhancement of Interac Debit, Interac Flash leverages the security behind Interac chip debit cards,” said Hubberstey. “This results in comprehensive cardholder protections preventing criminals from capturing data on contactless cards through electronic pick-pocketing or other means.”
At the end of January 2013, virtually all active Interac debit cards (99 per cent) and ABMs (99.6 per cent) had been converted to chip. Nearly 90 per cent of point-of-sale terminals (POS) had been converted. All POS terminals are to be converted by the end of 2015.
In support of Fraud Prevention Month, Interac Association, a member of the Competition Bureau’s Fraud Prevention Forum, has created an infographic that highlights the numbers above and also provides further insight to consumers around the security of Interac Flash.
Interac Debit: safety tips for consumers
Consumers can play a key role in fraud prevention by remembering to protect their Personal Identification Number (PIN) and by practicing debit card safety.
- If you have a chip card, insert the card first. If the POS device is not chip capable it will prompt you to swipe your card. Avoiding an unnecessary swipe of the card will reduce the chances of skimming.
- Use your hand or body to shield your PIN when making transactions at ABMs or at the checkout. Keep an eye on your debit card when conducting a transaction at the checkout and take your card with you when the transaction is complete.
- Check your banking statements regularly and contact your financial institution immediately if you detect any unusual activity, for example, purchases you did not make or missing charges.
- Notify your financial institution immediately, if your debit card is lost, stolen or retained by an ABM.
- Memorize your PIN - only you should know it. If you suspect that someone knows your PIN, even a friend or family member, change it immediately.
- Select a unique PIN. Never use obvious information, such as, your telephone number, date of birth, address or Social Insurance Number. These are numbers often stored in the same place as your debit card enabling criminals to easily guess your PIN.
- When using an ABM, if you suspect anything unusual do not use the machine and report it to the financial institution immediately.
- Be alert. If someone is watching you or makes you feel uncomfortable, cancel the transaction and use a different machine.
About Interac Association
A recognized world leader in debit card services, Interac Association is responsible for the development and operations of the Interac network, a national payment network that allows Canadians to access their money through Interac Cash at 60,000 Automated Banking Machines and Interac Debit at 766,000 point-of-sale terminals across Canada. Interac Flash, a secure contactless enhancement of Interac Debit allows Canadians to pay for items instantly with their Interac chip debit card at a reader that supports Interac Flash.
Interac Association was founded in 1984 and is comprised of a diverse membership that includes banks, trust companies, credit unions, caisses populaires, merchants, and technology and payment related companies.
Other related services offered by Acxsys Corporation, whose shareholders are the architects of the Interac network, include: Interac Online, for secure online payments made directly from a bank account; Interac e-TransferTM, for the transfer of money from one person's bank account to another person's bank account using an email address or mobile phone number**; and international services, which provide Canadian cardholders with point-of-sale access at nearly 2 million U.S. retailers, and PULSE, Discover, Diners Club International and UnionPay cardholders access to ABMs in Canada.
Interac Association and Acxsys Corporation
Interac, Interac Flash and Interac e-Transfer are trade-marks of Interac Inc. Used under license.
* All Interac cardholders are protected from losses resulting from circumstances beyond their control under the Interac Zero Liability Policy. See your financial institution for details.
** The Interac e-Transfer service, for secure person-to-person payments, is currently available to customers of over 90 banks and credit unions including BMO Bank of Montreal, CIBC, President's Choice Financial, National Bank, RBC Royal Bank, Scotiabank and TD Canada Trust among others. Central 1, through participating credit unions, offers the option of using mobile phone numbers, in addition to email, to notify Interac e-Transfer recipients. Money never travels by email or text message. More information about the Interac e- Transfer service and a complete list of participating banks and credit unions can be found at www.interca.ca.