The war on credit card fraud is being won. VISA U.S.A. reported this week that overall card fraud losses have dropped to an all-time low of six cents per $100 of total transaction volume. VISA says that compares to 7 cents in 1998 and 18 cents in 1992. VISA credits neural networks for the decline. VISA also said this week that its U.S. board has approved a new operating regulation regarding fraud that goes into effect in April. The new operating regulation replaces a VISA policy adopted in 1997, under which cardholders could be held liable for up to $50 if their VISA credit or debit cards were used fraudulently on the VISA system. The previous policy mandated zero liability, but only if the fraud, theft or unauthorized card use was reported within two business days of cardholders discovering such activity. The new rule covers the use of all VISA consumer card products including transactions made online, and eliminates the two-day stipulation.        

 VISA  VOLUME  VERSUS  FRAUD
 
     VOLUME   FRAUD    %
1990   $151b 190m    13bps
1991   $163b 277m    17bps        
1992   $181b 326m    18bps
1993   $215b 383m    18bps
1994   $273b 410m    15bps
1995   $341b 414m    12bps
1996   $393b 452m    12bps 
1997   $432b 389m     9bps
1998   $475b 355m     7bps
1999** $560b 336m     6bps 

b-billion  m-million  bps-basis points or cents per $100 dollars *volume excludes cash advances **projected Source CardData (www.carddata.com)