The other night on the news there was yet another report about rising credit card fraud and the so-called skimming machines used by your friendly waitrons and other dubious entities, with the usual advice of stay with your credit card, blah blah blah.
Now I'm a bit confused as to why we haven't resolved this issue in SA. We apparently have one of the most sophisticated banking systems in the world, but haven't introduced well known measures to stop credit card fraud.
France practically eliminated fraud overnight by introducing smart cards. This article on the M&G which I found while searching for some info on this details some of the changes required, and notes the reduction in fraud in France.
Obviously the banks have been rolling out infrastructure to support the cards and so on, but I think I first got emails about this around 1-2 years ago and things seem to have gone quiet.In France, the Carte Bleu chip was fully implemented at the beginning of 1990 and in the first year that all cards were chip-enabled, domestic fraud levels dropped by 78%. Significant fraud declines in the areas addressed by smart cards have been reported by Visa International in Britain, which has just completed the launch of Chip and PIN. This can be compared with South Africa, where fraud levels are increasing by around 20% to 30% a year.
There were some problems in France with the encryption on the cards being cracked at one stage (around about 2000). I'm pretty sure the encryption and key length have been improved (a longer key takes longer to crack). Unfortunately a precursory search didn't yield anything on the current situation in France.
The technology is so much better than a magnetic card and provides much better protection for the user - when are we going to start seeing these cards?