Venezuela lowered credit card fraud by a whopping 98%. This unprecedented cliff-like drop in card related fraud is unheard of in any market globally. This is mainly attributed to the shift from magnetic strips card to the new smart-card or chip cards.
Local private banks began implementing chip cards last year with the objective to prevent and stop electronic banking fraud. The EMV chip and pin technology initiative was launched in Europe in the early 1990s and has led to dramatic reductions on fraud rates.
The EMV technology has been implemented worldwide – except in the US, where magstripes still rule and chip cards are still extremely limited. Major players, MasterCard and Visa have strategically positioned themselves to refuse all liabilities from non-EMV upgraded ATMs and POS in the event of a loss.
In Venezuela, as a result of increased chip cards implementation, fraudsters have shifted their activities to alternative schemes including website cloning, card cloning, phishing attacks and social engineering.