At the recent CNP Expo, account takeover fraud emerged as the most oft-mentioned challenge for card-not-present merchants. New data from EMVco—the organization established by the major card networks to provide EMV standards and oversee implementation—could provide a clue why. On Monday, EMVco disclosed the number of chip cards in circulation around the world had increased from 4.8 billion at the end of 2015 to 6.1 billion a year later. Also, more than half (52.4 percent) of all in-store card transactions conducted during 2016 used EMV chip technology compared to less than 36 percent in 2015. Discover’s Soumya Chakrabarty, a keynote speaker at the CNP Expo and current executive committee chair for EMVCo, said adoption in the U.S. and Asia is driving growth in overall global adoption. Chip card adoption in the U.S., the world’s largest payment card market, rose from 26.4 percent in 2015 to 52.2 percent in 2016.
Experts have been warning for years that as the U.S. migrates to the EMV-compliant cards and POS systems mandated by the card networks, that, while counterfeit fraud will fall, card-not-present fraud will rise as fraudsters move from the more heavily defended card-present channel. Combined with an increase in the amount of stolen personal information available to fraudsters through data breaches, account takeovers are rising. As breaches continue to accelerate and EMV adoption continues to rise, ATO and CNP fraud of all types figure to continue their inexorable climb.