UK Consumers Face Highest Credit Card Fraud Rates in Europe

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UK consumers suffer from highest credit card fraud rates in Europe
Mobile Wallet adoption hampered by security concerns
Online shopping popular in UK but fraud experts warn consumers might underestimate dangers

UK consumers suffer from the highest rates of credit card fraud in Europe but are among the most confident when it comes to the security of online shopping, according to a global consumer survey by payments company and fraud prevention specialist ACI Worldwide.

The report from earlier this year, which surveyed more than 6000 consumers worldwide, revealed that almost one third of UK consumers (28%) have experienced credit card fraud in the last five years, the highest rate Europe.

The research also shows that most consumers only get wary after a fraud incident and consequently use their cards less. Despite this, a large majority of UK consumers (75%) believe that online shopping sites have the necessary security measures in place to protect their personal data against hackers.

Fraud prevention experts at ACI say the research suggests a gap between perception and reality of online fraud and are warning consumers, retailers and financial institutions to be vigilant ahead of Cyber Monday, which is expected to be one of the busiest online shopping days of the year.

Jackie Barwell, fraud expert at ACI Worldwide/ ReD comments:

“The good news is that online shopping is very popular in the UK and the large majority of consumers believe retailers have the right systems and security measures in place that will make online shopping a safe and enjoyable experience.

“However, fraud is still widespread especially when it comes to online retailing. Fraudsters will without doubt target consumers and retailers in the next couple of days when people will get carried away in the excitement of chasing deals and retailers might be overwhelmed by the amount of transactions they will have to handle.

“Retailers and consumers need to be on high alert especially as fraudsters are changing tactics quickly.

“It’s even more important at this time of the year to think, if an online offer is too good to be true, it most probably is – don’t always look for the cheapest option, especially if it’s wildly cheaper than anywhere else.”

Key findings of the report:

Credit Card Fraud

According to the research, the UK has the highest rates of credit card fraud in Europe. 28% of UK consumers said they had experienced credit card fraud at least once during the last 5 years, compared to 26% of respondents in France and 16% in Germany. Fraud rates were highest in UAE (44%), China, 42% and India 41% followed by the US (41%). In the UK 36% of those who received replacement cards as a result of data breach or fraudulent activity use their new cards less than they used the originals, compared to 34% in France, 49% in Poland, 29% in the US.

Online Shopping Security

The level of trust when it comes to online shopping security is relatively high, especially in the UK and the US. 75% of UK consumers and 77% in the US say they trust online shopping sites to secure their personal and financial information to protect against hackers. The level of trust is matched by consumers in India (73%) and China (72%) and is much lower in Continental Europe (France 61%, Germany 55%).

Mobile Wallet Adoption: Security Concerns

When it comes to Mobile Wallet Adoption security concerns among consumers are widespread. Mobile Wallet adoption rates in the UK are among the lowest in Europe. In the UK only 6% of consumers said they had paid using their Mobile Wallets (compared with 22% in Italy, 14% in Sweden, 72% in China and India, 47%). 55% of UK consumers said they are unsure or only somewhat sure about Mobile Wallet security.

Best data protectors

When it comes to protecting personal and confidential data, 49% of UK consumers said they believe large financial institutions are doing the best job, followed by the government (19%) and large chain stores (13%).

Jackie Barwell comments:

“In order to make real progress in combating fraud, financial institutions and retailers must take a more proactive role, not only by investing in fraud prevention and educating consumers about preventative measures, but also by working together in the battle against fraud.

“Retailers and banks for example should find ways of sharing data; this would have a real impact on the effectiveness of fraud prevention and help to identify fraud attacks more quickly, highlight fraud trends and to take fast, effective preventative measures.

“More importantly, it would help to regain the trust, loyalty and confidence of consumers, ensuring that, ultimately, the only loser is the fraudster.”