Fighting back card fraud as methods are getting trickier

Card skimming – the process of electronically copying information from a card’s magnetic stripe and putting it onto an empty card – is fast emerging as the most common form of credit card fraud globally. With the successful adoption of EMV chip and PIN credit cards and card reading devices, countries such as the UK has recorded a major decline in card fraud in recent years. 

According to a new forecast report from Timetric, credit card fraud in the UK has declined at a CAGR of 18.8 % since 2008 to value US$ 491.9 million in 2012. The main reason for this positive trend has been the introduction of EMV chip and PIN credit cards and card reading devices. Although card fraud is much higher in value terms in developed economies such as the US, the UK and France, these countries have been successful in limiting the growth of fraud by adopting advanced security measures, innovative products and strict regulations in order to prevent fraudulent activities. Emerging economies like China and Russia have lagged behind in introducing such measures and have therefore witnessed significant growth in card fraud.

Card skimming is the most common form of credit card fraud

Every year millions of dollars are lost around the world due to credit card fraud – and fraudsters are only getting more innovative and technological advanced in their hunt for credit card information. Card skimming is the most common form of credit card fraud globally, especially in countries where magnetic stripe cards are still in use. Fraudsters carry pocket skimming devices, which is a battery-operated electronic magnetic stripe reader that can be used to swipe customer’s cards to steal information encoded in it. Skimming devices can also be fitted into the swiping area of POS terminals and ATMs. Since cardholders normally feel safe in such payment situations and do not suspect any malicious activity to happen, skimming can be very difficult to trace. According to Timetric’s new report on trends and issues in managing credit risk cycle, the adoption of EMV chip and PIN credit cards has proven successful in preventing card fraud in the UK and other European countries.

China records largest growth in card fraud

Among the developed markets, the value of card fraud was highest in the US, growing at a CAGR of 2.9% to value US$3.55 billion in 2012. Among the emerging markets, the value of card fraud in China increased at a staggering CAGR of 36.3% to value US$173.3 million in 2012. China was followed by Brazil with a card fraud value of US$150.3 million in 2012 while, in terms of growth, Russia gained the second spot with a CAGR of 28.2%.

Timetric’s report, ‘2020 Foresight: Best Practices in Managing Credit Risk Cycle’ was published on the 29th April 2013 


Japan’s tourism industry to recover after tsunami and nuclear crisis

Japan’s tourism industry took a sharp downturn in the aftermath of the tsunami and nuclear crisis that hit the country in 2011. A new report from Timetric suggests a solid recovery for the country’s tourism industry although fears of natural disasters and the strong yen could limit the expansion. 

Over the past few years, Japan’s tourism industry has faced numerous challenges. In March 2011 Japan’s tourism industry took its steepest downturn to date when the earthquake, subsequent tsunami and nuclear crisis hit the country. The earthquake and tsunami caused severe damage to the transportation network, including road, rail and air transport infrastructure, disrupting services at several locations. With the cancellation of more than 560,000 room bookings in the month after the earthquake, the Japanese hotel, travel and tourism industry took a major hit. The strengthening of the Japanese yen, combined with concerns over the nuclear disaster, further reduced international travel to Japan.

Strong recovery towards 2017

New research from Timetric suggests a strong rebound, with international arrivals growing by 34.6% reaching 8.4 million at the end of 2012. By 2017 inbound tourist arrivals are expected to reach 11.0 million, expanding at a CAGR of 5.7%. The key drivers for this growth will be improved economic conditions and the government’s efforts to promote Japan as an attractive tourist destination. The volume of domestic tourists is also expected to grow, increasing at a CAGR of 1.68% reaching 330.9 million by 2017. Outbound tourism is expected to grow from 18.5 million outbound departures in 2012 to 21.9 million in 2017, rising at a CAGR of 3.77%

Fears of natural disasters and the strong yen could limit growth

Japan is situated on the intersection of various continental and oceanic plates causing risk of earthquakes, tsunamis and typhoons. Negative travel advice, due to the risk of natural disasters, issued by the travel boards of several countries to their residents, could potentially damage the attractiveness of the country as a tourist destination. Furthermore, the rising value of the Japanese yen is a concern for the Japanese travel and tourism industry. The strong yen makes Japan an expensive destination for inbound tourists, and it also means that many Japanese people can afford to holiday abroad, making outbound travel more attractive than domestic travel.

The Timetric report; ‘Travel and Tourism in Japan to 2017 – Post Tsunami and Nuclear Crisis, Tourism Sector to Witness Steady Growth’ was published on the 30th April 2013.

Future Payments 2013 Awards Gala Dinner

15 – 16 May 2013. Millenium Gloucester Hotel, London.

LONDON. A new event – Future Payments 2013 – is set to start on Wednesday, May 15, in London, bringing to the City an intense two-day insight into the future developments of payments and banking technology.

The happening, organised by Timetric’s VRL Financial News at the Millenium Gloucester Hotel, will see leaders from across the banking, payments, retail and telecoms sectors discuss how technology is changing the industry and people’s behaviour.

All this will take place at a crucial moment for all stakeholders, as the future of payments is all but clear and defined, and the risk of turning opportunities into threats is high.

Worldwide eCommerce revenue is set to reach $936 billion by 2015 and $55 billion is expected to be remitted internationally via mobile phones in 2016; by 2016 more than half of the dollars spent in retail will be influenced by the web, with a quarter of consumers using retail stores as “showrooms” and buying online; 46% of internet users already use social media to inform their purchasing decisions before they buy: new and old players will give their point of view on how these factors are shaping their strategy.

Andy Cook, Timetric Group Publisher, said: “The conference has a clear aim – to get people together from across industries, to find answers to a clear set questions: how are consumers’ expectations changing? What will be the impact of telecommunications advances on the way people transact? How will the payments technology landscape evolve over the next ten years? Should payments technology shape consumer behaviour, or simply respond to it?”

On the evening of the conference the Cards & Payments Europe Awards will be held at a Gala Dinner. These awards will allow the best and brightest within the industry to be recognised and celebrated by their peers. The awards provide an ideal platform for companies to showcase their achievements and reward their most outstanding performers.

Editor’s Note:

About VRL Financial News

For over 20 years, VRL has been delivering a unique series of conferences and events to the financial services market. Sponsored by the major players in the industry, VRL conferences deliver focused and original content, with innovative first-time speakers and provocative sessions, exclusive research and a rich mix of delegates.

With major international conferences on the agenda in 2013, each of which is a red letter date in the diaries of the world’s top financial players, the learning and networking opportunities of joining with VRL are second-to-none. More information available on

A positive outlook for the Finnish cards and payments industry

Growth in online shopping and m-commerce leads Finland’s cards and payments industry forward.  

Despite having one of the smallest populations in the eurozone, Finland is miles ahead of the rest of Europe in terms of card awareness and usage levels. The country has the highest usage of card payments in terms of transactions per person, which is more than that of the UK and the Netherlands, reveals a new report from Timetric. The rise of smartphones and apps combined with lower prices, improved search engines and price comparison sites has resulted in the growth of m-commerce and e-commerce in recent years. E-commerce sales increased from EUR8.85 billion in 2009 to EUR10.4 billion in 2011, and according to a survey conducted by AddValue on behalf of operator DNA in 2013, 60% of Finns own a smartphone, 76% own a laptop and 18% own a tablet. The increasing market for online and mobile commerce, combined with a positive economic outlook have been the main drivers for growth in the Finnish cards and payments industry – an industry that  has been growing marginally in terms of both volume and value since 2008. Finland’s overall card industry rose from 13.7 million cards in 2008 to 15.6 million in 2012 at a CAGR of 3.86%. According to Timetric, this positive trend is set to continue. By 2017 the number of cards is expected to reach 17.1 million. Debit cards has the largest market share with 82.32% in 2012. In terms of transaction volume there was 1.3 billion transactions in 2012. It is anticipated that this number will grow at a CAGR of 0.65% to reach 1.4 billion transactions by 2017.

Contactless payments on the rise

Contactless and NFC payments are also being introduced in Finland. K-Plussa, the largest and most-diverse loyalty program launched a contactless card in February 2012. So far, the card has been used by more than 300,000 K-Plussa customers. Elisa, one of the largest mobile networks in Finland, in association with MasterCard and the student-owned benefit and discount card Lyyra, issued prepaid NFC (near field communication) stickers to students in the third quarter of 2012. These stickers were issued to more than 100,000 students and can be used in college canteens and at other stores where contactless terminals are installed.

Timetric’s report: ‘Emerging Opportunities in Finland’s Cards and Payments industry: Market Size, Trends and Drivers, Strategies, Products and Competitive Landscape’ was published on the 19th April 2013. 

Rethinking Reinsurance

Growing uncertainties in the global economy and the increasing occurrence of natural disasters has increased the importance of reinsurance in recent years. According to Timetric’s new foresight report, these are the trends to watch. 

Reinsurance hubs will profit from growth in the global insurance industry

Growth in insurance segments such as life, non-life and personal accident and health insurance is expected to fuel the growth of reinsurance – as direct insurers cede proportions of their written premiums. Although the developed insurance markets were affected by the financial crisis from 2008, many recovered and recorded growth following the recession. This was driven by increases in infrastructure investment and domestic demand. In the same period – despite the financial crisis – emerging economies such as China and India recorded strong growth, and are expected to grow further towards 2020.

Overseas markets remain major revenue generators for reinsurers

Reinsurers operating through hubs generate most of their revenues from offshore markets, meaning that the domestic reinsurance markets in hubs such as Singapore, Bermuda, Switzerland and Hong Kong are very small. Singaporean reinsurers generate more than 90% of their revenue from overseas markets such as Japan, China and South Korea. Most reinsurers set up offices in reinsurance hubs due to favourable regulatory and tax structure, and also to gain access to neighbouring markets. The report finds that while reinsurers operating from Bermuda cater to demand from North and Latin America, reinsurers from Switzerland and Singapore serve European and Asia-Pacific markets. However, reinsurers based in the world’s largest reinsurance market, the US, primarily focus on domestic business.

Solvency II to change the dynamics of insurance and reinsurance

The past years global economic uncertainties have meant more regulation of the financial services sector. New regulatory standards, including risk-based solvency and capital requirements, were introduced in many countries’ insurance industries. In January 2014 members of the European Union will implement new Solvency II standards. As a result, many insurers and reinsurers will be forced to restructure and strengthen their capital and risk exposure. The implementation of Solvency II is expected to lead to significant growth in the reinsurance industry, as consolidation through merger and acquisition activity will increase, and less financially sound insurers will seek assistance and support from reinsurers.

 Product innovation will be key priority for reinsurers

Reinsurance is a highly competitive industry, and most major markets are served by a number of local and international reinsurers. Product differentiation, gaining competitive advantage, profitability and increasing market share are the primary challenges for reinsurers. To increase business and take advantage of new market opportunities, reinsurers will uphold flexible product mixes and add new products to their portfolios. Leading reinsurers such as Munich Re and Swiss Re have started to provide Solvency II solutions and services, including special Solvency II consulting services.

Timetric’s report; ‘2020 Foresight: Reinsurance hubs’ was published on the 8th April 2013.

Paying with your phone – a positive outlook for MPOS technology

Paying with our phone could soon be the new reality for shoppers. According to new research from Timetric, things are looking bright for the global mobile-point-of-sale industry (MPOS).

From 2011 – 2012 the number of MPOS terminals registered an annual growth of 111%. This trend is set to continue, as the volume of terminals is expected to increase from 4.5 million in 2011 to 38 million in 2017, at a projected CAGR of 42.7%. The positive market outlook is driven by growth in the retail sector, increased online trade, a rise in smartphone usage and card penetration. Even though traditional POS systems are still far more common – with MPOS terminals owning 17% of the total POS terminal market in 2012 – this number is expected to increase substantially and reach 46% by 2017.

Embracing MPOS technology

MPOS technology has a strong presence in countries such as the US, Canada, the UK, Germany and France fronted by brands such as Square, iZettle, SumUp, Payleven, PayPal Here and Intuit. Many of these are currently running a number of trials and pilot programs in partnership with businesses such as Perry Ellis, Gucci, Saks Fifth Avenue and Aurora Fashions. Restaurants, pubs and hotels such as Horney Goat Brewing Company and The Gaylord Hotels have successfully adopted the technology. Another area which has embraced the technology is transit systems and taxi services. Initially MPOS technology was targeted at small enterprises who could not afford the conventional point of sale (POS) system. However, demands have been driven by new technology benefits such as improved customer service and the ability to process payments at anytime in any location. Moreover, the use of smartphones and tablets as base-devices has enabled developers to expand their market share. The positive growth potential offered by the technology has attracted a number of competitors, and according to the Timetric report, further innovations are expected to take place in the future.

MPOS solutions not free from challenges

The advantages of using MPOS solutions are compelling, yet there are several operational, technical and regulatory challenges. One of them is the reliability of the service. Consumer smartphones and tablets are not yet built with strong security features and paying with these can therefore leave the customer vulnerable to fraudulent activity. Furthermore, processing payments over a volatile wireless network can also prove to be problematic.

Timetric’s report; ‘2020 Foresight: Mobile Point of Sale Technology’ was published on the 17th April 2013.

Notes to the editor:


Mobile-point-of-sale technology (MPOS): MPOS technology brings wireless technology to conventional POS systems. This technology doesn’t change the payment structure, but facilitates transactions to be processed through a mobile terminal which uses the same logic and codes as any fixed POS terminal. Innovations have enabled smartphones and tablets to be modified into mobile POS systems.

Social media to transform insurance underwriting

Searching Facebook and other social network pages of customers has become a frequent practice on the claims side of the insurance business.

Especially in the case of fraudulent claims, social media continues to be an important tool in the fight against insurance fraud. A new report from Timetric finds that searching customers Facebook profiles is one of the first things insurance investigators do to gauge the risk profile of potential and existing customers. For instance in the case of property, casualty and fire insurance, underwriters are using social networks to check if claims are genuine. By understanding the precise profile of the person on social networks and viewing the person’s previous records, insurance companies can get an idea of the payouts that need to be made. Since social data is still in its developmental stages, there is a long way for many insurance companies to fully integrate social media into underwriting practice. Moreover, regulation concerning the use of social data and the debate surrounding the privacy of individual information has to be settled too. Various countries, including the US, are currently debating making their social media network related laws more stringent.

The Timetric report; ‘Trends in Non-Life Insurance Underwriting’ was published on the 26th April 2013.