Tracking credit card fraud trends is a standard practice for any financial institution. When tracking that data, it's important to have context of what the last few years looked like, and what that means for future trends across the fraud ecosystem. What's important to track is what types of card fraud are mot prevalent (CP vs. CNP fraud), the rate at which credit card fraud is growing and who it is impacting most.
Knowing how credit card fraud patterns are evolving can help your financial institution know which tools your team needs to proactively get ahead of these rapidly-growing problems. We break down four key trends:
The Motley Fool recently gathered and shared some key research stats from industry experts. This data includes:
- How card-present fraud and card-not-present fraud have evolved since 2014.
- How the number of card fraud reports is growing
- Which population is most impacted by credit card fraud
Trend 1: CNP Fraud Rose at a Faster Rate than CP Fraud Declined
Percentage of U.S. consumers affected by CP and CNP Fraud
The EMV chip card shift led to a sharp increase in CNP fraud, but both types of credit card fraud decreased from 2017 to 2018. That doesn’t mean card fraud is declining (see the next chart).
Trend 2: New Account Fraud Is Rising Significantly, While Existing Account Fraud is Dropping
An increasing percentage of credit card fraud is now from new account fraud.
Trend 3: Credit Card Fraud Reports Have Risen ~184% In 4 Years
The number of credit card fraud reports rose at a drastic rate between 2015 and 2016, slowed between 2016, but saw another spike between 2017 and 2019. These figures are anticipated to rise at similar rates. Credit card fraud also is the most common type of identity theft (~29% of all cases). The number of credit card fraud reports have nearly tripled since 2014.
Trend 4: Baby Boomers Continue to Be a More Vulnerable Population for Credit Card Fraud
It's estimated that 35% of consumers have been victims of credit card fraud. Keeping customers informed about how to keep their credit card data continues to be a challenge for all financial institutions. This is increasingly true for banks with older customers who may not be as savvy about how to protect their data online. Baby boomers continue to be a target of fraudsters, too.