47% of US consumers experience card fraud as risky behavior continues, says recent report

money-256319_1920A recent report released by financial services provider ACI Worldwide (2016 Global Consumer Card Fraud: Where Card Fraud Is Coming From) reveals that payment card fraud rates are on the rise globally, with almost a third of US consumers experiencing card fraud.

The survey gathered information from over 6,000 consumers and examined consumer behavior in relation to global card fraud. It found that Mexico, with 56%, and Brazil, with 49%, are the only two countries with higher card fraud rates than the USA (47%).

Most consumers are able to prevent card fraud

The report states that in the United States consumer behavior impacts “whether someone becomes a victim” of card fraud. Although consumers have little or no control over skimming or data breaches, most consumers are able to prevent card fraud resulting from phishing attacks, lost or stolen cards, and ‘friendly fraud’ – also known as chargeback fraud.

The report also highlights the importance of educating consumers as the usage of unsafe smartphones increases. It encourages financial institutions to take extra precautions with messaging and to warn consumers about the risks of card fraud as it may “lead to users ignoring those messages”.

The report highlights the increase of risky consumer behavior. In the last five years, consumers in the United States reported the following:

  • 20% of respondents said they’ve left their smartphone unlocked when not using it.
  • 18% of consumers have thrown papers or documents with account numbers or bank statements in the trash.
  • 14% reported using online banking or Internet shopping without security software or on a public computer.
  • 9% of consumers made a note of their own PIN and carried it with their cash card.
  • 8% responded to emails or calls asking for bank details.

Moreover, the report emphasizes that financial institutions and consumers suffer when they are “not engaged in the fraud-prevention process and are unaware of how their behavior put them at risk”.

Education is the key to reducing risk

The report recommends that customer education and participation to reduce the risk of fraud is more important than having strong ‘aftercare processes’ when fraud occurs.

Additionally, educating consumers can help organizations and financial institutions reduce costs and protect revenue.

The report suggests that consumer education and participation be improved by:

  • Providing fraud risk information on website or mobile apps.
  • Notifying consumers via email.
  • Providing consumers with a basic understanding of how the institution is keeping them safe.

Financial institutions, merchants, and service provides can help prevent card fraud by educating their employees with IT Governance’s PCI DSS Staff Awareness E-learning course. This web-based course is designed to increase employee awareness of the PCI DSS requirements and provide a clear and simple explanation on what an individual must do to reduce the risks of card-based fraud.

Read more about the PCI DSS Online Course, Staff Awareness Edition here >>