Card not present (CNP) fraud has surged to AUD417.6m ($330.8m), accounting for 78% of total card fraud in 2016, according to a report published by the industry body Australian Payments Network.
With the increased transition to online platforms, the online payments fraud is also soaring in Australia and has more than doubled over the past six years.
In 2016, Aussies transacted a record AUD714.5bn ($566bn) on their cards, of which fraud accounted for AUD534m ($423m) or 0.074%.
The report further highlights that card and cheque fraud was under 0.03% of the AUD1.86 trillion ($1.48 trillion) total transacted.
According to the 2016 Australian Payments Fraud Data Report, there has been a 13% increase in card skimming fraud to AUD25.8m ($20.4m) from AUD22.9m ($18.1m) in 2015. The frauds were executed through ‘ghost terminals,’ false terminals made to look like real card readers that are not connected to the payments network.
For every $1,000 spent on credit cards, fraud accounted for 74.7 cents, up from 66.9 cents in 2015 and 43.8 cents in 2012.
The report predicts that only one-fifth of transactions will involve the input of card details in internet browsers by 2020, due to the growth of mobile wallets and sophisticated shopping carts.
Australian Payments Network CEO Leila Fourie said: “Card-not-present fraud continues to grow as perpetrators follow increased payments activity online. Australia compares favourably to the UK and US when it comes to fraud rates – and the industry is continuing its efforts to provide fraud prevention strategies that adapt to changing payments trends.
“Australia is well-advanced in fraud prevention technology, thanks to the industry’s leading investment in EMV chips, tokenisation and online customer authentication tools.
“Over the next year our focus is to continue to educate businesses about online fraud prevention and support the roll-out of risk-based customer authentication including investigations into how biometrics, geolocation and social media enable this.”