M&S spends £4m on fraud-fighting card tech

Marks and Spencer will be one of the first retailers to complete the rollout of new technology to its stores in a £4m project to help cut bank card fraud.

The high-street chain took part in the Northampton trial of the 'chip and Pin' secure cards earlier this year and has now almost finished equipping all its stores with the hardware and software to accept the new cards at its cash tills.

The cards have a secure chip instead of a magnetic strip, allowing transactions at tills to be verified by tapping in a four-digit Pin number instead of signing a receipt, but concerns have been expressed by retailers about the cost and benefits of the new technology, with some claiming most of the benefit goes to the banks.

But Alastair Barnfield, lead infrastructure technical designer at Marks & Spencer, told silicon.com that in addition to some cost contribution from the banks and incentives such as savings from reduced service charges, there are clear business benefits for retailers.

"The main one is [fraud] liability. From a cost point of view that is easily justifiable. We can also improve processes by consolidating front-end processes – for example, we can see when tills and stores go offline," he said.

Barnfield said the chip and Pin project fits in with Marks & Spencer's' move to a centralised infrastructure from a store-based one.

Marks & Spencer will also be one of the first companies to issue large volumes of the new chip and Pin cards. Today it has launched its '&More' card, which combines loyalty card, store card and credit card functionality onto a EuroPay Mastercard Visa (EMV) secure chip card. Barnfield said around 2.6 million will be issued to existing customers by the end of October.

The UK chip and Pin rollout will use the recently ratified version two of the EMV standard, which Barnfield believes could one day lead to multiple bank accounts being stored on just one card, with the customer selecting the one they want to use at the till or cash machine.

He said the South African and Australian chip and Pin projects with the first version of EMV had used cards where up to 25 accounts could be stored on one card, but he admitted that kind of feature will be a long way off for European customers.

"The banks are not ready for that yet," he said.