As a widening range of payment options is offered to French customers, increasingly sophisticated fraud activities have developed. Bank card fraud is particularly prevalent in France, impacting customers and businesses. Here’s what you need to know about bank card fraud and how to protect your business.

What’s in this article?

• What is bank card fraud?
  
• A widespread problem in France
  
• Different types of bank card fraud
  
• The impact of bank card fraud on businesses
  
• The impact of bank card fraud on individuals
  

What is bank card fraud?

Bank fraud occurs in various forms, including card fraud, which focuses specifically on credit and debit cards. This kind of fraud occurs when a bank card is used to make purchases or withdraw money without the cardholder’s permission.

This practice is becoming increasingly widespread in today’s digital world, as online payments and digital wallets provide fraudulent actors with more access channels.

A widespread problem in France

Many people in France are well aware of payment fraud. The country experienced €584.6 million in payment fraud in the first quarter of 2024. Of that amount, 92% was the result of card fraud. France is also the European country hardest hit by this kind of crime—42% of all European bank card fraud cases occur in France.

French authorities are taking action to address the issue. For instance, the Banque de France holds a Financial Education Week (Semaine de l’éducation financière) every March. The event features workshops, talks, and informational materials to raise awareness about financial security issues.

Different types of bank card fraud

As digital wallets and online payments become increasingly common, a physical card is no longer required for card payments. As a result, various types of card fraud have developed:

Card theft

The most frequent method involves stealing a card and using it to make in-person purchases in stores. Entering the card’s personal identification number (PIN) is required to complete a purchase, but it’s typically not required for payments under €50.

Fraudulent actors can also use stolen cards to make online or over-the-phone purchases. This is known as card-not-present fraud, a complicated scheme impacting both individuals and businesses.

Account takeover

Identity theft can allow fraudulent actors to access online bank accounts. In that case, a physical card isn’t needed—the stolen information is used to take over the account and either steal money or make purchases.

Fraudulent actors can steal card information through various means, including:

• Intercepting data directly at a store or restaurant
  
• Obtaining data through emails or text messages—a technique known as “phishing”
  
• Obtaining data by eavesdropping on phone calls made in public
  
• Hacking a public Wi-Fi network while a card is being used
  
• Retrieving information from documents that weren’t destroyed properly
  
• Abusing the trust of vulnerable people
  

The dark web also hosts markets where fraudulent actors can purchase stolen card data. Sellers often provide the full card details, including the card number, expiration date, card verification value (CVV), and the cardholders’ personal information.

The impact of bank card fraud on businesses

For businesses, bank card fraud usually results in financial losses. This is especially true in the case of payment reversal, a process designed to protect customers. When a transaction is disputed, the card issuer—or a different financial institution—can withdraw the amount from the business’s account, possibly adding extra fees in the process.

If a business fails to check the buyer’s identity properly or doesn’t store cardholder data securely, they could be held liable for the fraud, which has financial consequences. In ecommerce, fraud can also damage customer trust, leading customers to be more hesitant about shopping online.

How can businesses stay safe from bank card fraud?

Banks urge businesses to stay vigilant with regard to card fraud. They should watch out for customer red flags. For example, businesses should pay attention to customers who appear to be in a rush or try to distract the salesperson during payment.

As part of best business practices, monitoring unusual online orders is also helpful. Indicators of credit card fraud can include:

• Orders coming from high-risk or unfamiliar countries
  
• Unusually high amounts
  
• A series of small orders
  
• A change of shipping address after the order has been placed
  

To safeguard business interests, businesses should prioritize customer security. Customers should be encouraged to create strong passwords and, ideally, use multifactor authentication. This method is effective because fraudulent actors typically don’t have access to both the card details and the individual’s mobile device.

Fortunately, artificial intelligence and machine learning provide powerful tools to detect and prevent fraud. These technologies help enhance transaction security.

Secure your website

Securing your website is key in the fight against fraud. Stripe Radar analyzes Stripe data in real time, spots subtle warning signs, and updates its algorithms to prevent even the most sophisticated fraud attempts. Businesses receive targeted alerts that help them deflect fraud attempts and keep their customers safe.

The impact of bank card fraud on individuals

Card fraud primarily impacts individuals. The cardholder can incur direct financial losses equal to the amount of the fraudulent transactions, plus any associated fees. While banks typically refund the stolen money, victims still face significant financial and administrative burdens.

How can individuals report this type of fraud?

Any cardholder can become the victim of bank card fraud. When this kind of fraud is detected, it’s important to take action at once by calling the French interbank emergency number at +33 892 705 705. Cardholders can also directly contact the bank that manages the impacted account. Residents in France with access to France Connect can also use a service called “Perceval” to block their card in case of bank card fraud.

How can individuals stay safe from bank card fraud?

While fail-proof protection from card fraud doesn’t exist, some measures can help mitigate the risks. Cardholders should memorize their PINs and never write them down, whether online or elsewhere. Of course, cards should be kept in a safe place.

As online payments expand, it’s also important to remain vigilant about phishing attempts. These could be emails or text messages that seem to come from a bank but have actually been sent by fraudulent actors. These increasingly sophisticated phishing attempts typically prompt customers to click a link, which gives fraudulent actors access to the customers’ personal information without them realizing it.

Customers should monitor their bank statements regularly to spot any suspicious activity right away. Recognizing the warning signs and taking action without delay when fraud occurs allows cardholders to remain as safe as possible.