UK retailers give thumbs up to chip and PIN

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Chip and PIN is officially six month's old today and the Association of Payment Clearing Services (APACS) says it's a massive success, with 87 per cent of tills now converted.

Security has been improved by the move; according to APACS, chip and PIN was responsible for a £60 million reduction in fraud in 2005. However, cardholder not present (CNP) fraud rose by 21 per cent in the same period, eliminating around half of the saving.

Sandra Quinn, director of corporate communications at APACS, defended the statistics. "Of course it hasn't eradicated fraud, it never could, as fraudsters will continue to target us and our money but it is a fact that chip and PIN has made our cards safer than they were two years ago and banks and retailers will continue to work together to keep it this way.

"Now we need to remain vigilant, as fraudsters will always try to find other ways to get hold of our money. That is why we are constantly reminding cardholders how to protect themselves from fraud."

Although many retailers have been using this authentication method for longer than six months, February 14 2006 marked the official mandatory compliance date for all debit and credit card transactions with chip and PIN functionality.

Now, more than 150 transactions are verified in this way every second, which has risen from 85 per second this time last year. Some 92 per cent of the total 141 million established card base have been issued with chip and PIN compliant cards and more than 99.8 per cent of all chip and PIN card transactions are today verified by PIN.

"Britain is now a truly mature chip and PIN nation," said Quinn.

"Millions and millions of people have adapted to the change with no problems at all. That means that we are all a lot safer when we go shopping, and that fraudsters have been denied millions of pounds of stolen money."

The new system has saved just under £60 million through supervisory, till and back-office system efficiencies, according to research conducted in February this year by the Centre for Retail Research. The study surveyed 600 retailers with a combined turnover of £89 billion to conduct the study on behalf of VISA UK.

Paul Smith, director of retail services policy at the British Retail Consortium (BRC) agreed that the UK's implementation of chip and PIN has been well received by retailers.

"The BRC is delighted that the switch to chip and PIN has been so successful," he said. "Feedback from our members has been overwhelmingly positive with many reporting that transaction times are quicker now because of chip and PIN."

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