Shoppers will have to use pin numbers to pay with their debit or credit cards from St Patrick's Day, when new measures to protect against bank fraud come into force. The traditional option of signing for card purchases will no longer be available to consumers, except in limited circumstances.
This final stage of the switch to "chip-and-pin" card technology will contribute to further reductions in bank fraud, the Irish Payment Services Organisation (Ipso) said yesterday.
"Skimming" or counterfeiting of ATM cards would become more difficult, it said, because the ATM would read the micro-chip on a bank card as well as the magnetic strip. At present, forgers use simple technology to copy a cardholder's details and copy them on to another card with a magnetic strip. A chip-and-pin card is more expensive to counterfeit.
Bank fraud dropped last year for the first time since 2002, from €13 million in 2005 to €12.5 million last year, according to Ipso. Already, the spread of chip-and-pin technology and Garda response had led to a 65 per cent drop in the number of ATM skimming incidents.
Ipso's figures refer to losses absorbed by the banks due to the various types of fraud; no figure is available for the losses suffered by cardholders or retailers.
In Britain, the introduction of chip-and-pin technology has led to banks taking a harder line with customers who fall victim to card fraud. Complaints to the financial ombudsman have risen as customers find their claims for compensation are dismissed and, in some cases, they are accused of collusion in the crimes.
Before the advent of chip and pin, British banks were more likely to write off fraud costs; now, however, they ask for proof that a customer did not disclose the pin.
Ipso says nothing has changed here for the consumer. "Just as they do today, cardholders should continue to be responsible in protecting their cards and keeping their pin secret."
Úna Dillon, head of card services at Ipso, said it had come across cases of extreme carelessness by consumers, such as the person who carved his pin number on his card. One Irish bank found that half of all cases reported as fraud were found to have other explanations. Ms Dillon said internet fraud accounted for less than 1 per cent of the total in 2002 but was growing fast.
An Irish Financial Ombudsman spokeswoman said yesterday it had not received any complaints about chip and pin but this might change after St Patrick's Day.
