Leading security and consumer protection features show that Canadians’ fears around debit technology are misplaced
TORONTO, February 27, 2017 – For the seventh year in a row, Interac Debit losses due to skimming have declined, reaching a record low of just $11.4 million. Latest fraud figures released today by Interac Association show that only $1.5 million of that fraud occurred in Canada, thanks in large part to the completion of the transition to chip technology that began in 2008.
Despite these record-low fraud numbers, however, a recent survey for Interac Association/Acxsys Corporation (Interac) found Canadians are increasingly concerned about fraudulent activities such as skimming and electronic pickpocketing. For example, 75 per cent of debit cardholders said they were somewhat or very concerned about skimming, up from the 49 per cent of cardholders who expressed similar concerns in 2015, while 71 per cent were somewhat or very concerned about electronic pickpocketing, up from 40 per cent the year before.
Joanna Schoneveld, Senior Manager of Fraud Programs at Interac, says these findings suggest a misperception among Canadians about the risk of debit card fraud in Canada.
“According to our survey, 3 out of 4 Canadians are worried about payment card ‘skimming’, and 36 per cent have used their payment card less due to this worry – but Interac Debit remains one of the safest ways to pay,” she said. “Our secure chip processing makes fraud due to skimming extremely difficult, and that’s only one of our anti-fraud measures. In fact, out of the $351 billion dollars that went across the Interac Debit network in 2016, only 0.003 per cent – was fraudulent, with just 0.0004 per cent occurring in Canada.”
The total number of debit cards reimbursed for fraud in 2016 was also down to a record low of just 19,000, a 23 per-cent drop from 2015 and down more than 90 per cent from the 238,000 cards reimbursed in 2009, when fraud losses totaled more than $140 million. Usage of the service has grown by 72 per cent since 2009.
“The Interac network is extremely safe thanks to the fraud prevention efforts and investments we make in collaboration nationally and internationally with financial institutions, acquirers, merchants and law enforcement,” said Mark Sullivan, Head, Client and Fraud Management, Interac Association/Acxsys Corporation. “Cardholders are seeing the tangible benefits of these collective actions with record low fraud numbers, affecting fewer and fewer cardholders every year, something we expect to continue in the years to come now that the move to chip technology is complete.”
Sullivan notes that all ABMs and debit cards in Canada were fully converted to chip technology in 2012 and all point-of-sale terminals became chip-enabled as of October 2016. As a result, it appears that criminals are migrating their fraud outside Canada to non-chip environments and card-not-present transactions such as over the Internet and by telephone, which aren’t permitted by Interac in Canada. He says Interac rules offer account holders the added protections by not allowing card-not-present, offline and signature transactions.
In addition to chip technology, the Interac network uses sophisticated monitoring and detection systems to detect fraud even before consumers realize there might be an issue.
Sullivan adds that Interac Flash, the contactless enhancement of Interac Debit, has all of the same security features as Interac Debit, such as EMV-based secure chip processing, which protects against skimming, counterfeiting and electronic pick-pocketing. Interac Flash transactions are also subject to transaction limits that, when exceeded, require the payer to insert their cards and enter their PINs for verification in the event a card is lost or stolen. Finally, these security measures are further backed by the Interac Zero Liability policy, under which cardholders are reimbursed 100 per cent should any type of unauthorized transaction occur.
Thanks to these security measures, Interac Flash and Interac Debit are the safest way to pay in Canada when using a payment card.
About the Interac Zero Liability Policy
You will not be liable for losses resulting from circumstances beyond your reasonable control when using Interac Debit, Interac Flash, cross-border debit and Interac Online service. This includes losses resulting from technical errors, system problems or fraud.
The Canadian Code of Practice for Consumer Debit Card Services is embedded in the Interac rule framework. This means that financial institutions who offer these Interac products must provide zero liability for these Interac products. The specific terms are outlined in financial institution client agreements. If you experience an issue with these Interac products, your financial institution will deal with the matter directly, as the financial institution will be responsible for reimbursing you for your losses resulting from circumstances beyond your reasonable control.
About the Survey Methodology
A survey of 1505 of Canadians was completed online between Feb 3rd 2017 to Feb 8th 2017 using Leger’s online panel, Legerweb. A probability sample of the same size would yield a margin of error of +/-2.5%, 19 times out of 20. The study was weighted by age, gender, and province based on Statistics Canada’s 2015 population estimates.
About Interac Association and Acxsys Corporation
Together, Interac Association and Acxsys Corporation operate an economical, world-class debit payments system with broad-based acceptance, 24/7/365 reliability, security, and efficiency. The organization is Canada’s leading payments brand and is chosen an average of 16 million times daily to pay and exchange money. For more than 30 years, it has facilitated secure financial transactions through the development of innovative and convenient digital debit and money transfer solutions. A leader in the prevention and detection of fraud, the organization has one of the lowest rates of fraud globally. Visit Interac.ca or follow us @Interac.