MasterCard getting tougher on fraud

MasterCard says a rise in credit card transactions via the internet is prompting card firms to push tougher data security standards for merchants.

MasterCard executives said the increase in so-called "card-not-present" transactions was one of the key reasons for card heavyweights to promote tougher security standards.

Kees Kwakernaak, vice-president, emerging technologies and acquiring for MasterCard Australasia, said new standards being pushed by MasterCard are designed to protect merchants against the activities of hackers. The standards, designed to cover methods of gaining access to a merchants' online environment, will include stringent testing of merchant firewalls.

MasterCard is in the early stages of piloting a series of site data protection standards for merchants with one of Australia's large banks, with the project expected to be extended to other banks in Australia by the second quarter of 2003.

Kwakernaak declined to name the bank the trial is being undertaken with, saying it was their prerogative to publicise their involvement if they so wished.

The initiative largely mirrors a project being undertaken by rival card heavyweight Visa International, which plans shortly to trial a series of minimum ecommerce and data security standards for merchants with medium-to-large transaction volumes.

Kwakernaak said: "There's a move in the credit industry from a card-present to a card-not-present environment, including internet, mail-order and telephone, where you cannot see the physical card, you cannot check the signature."

However, Kwakernaak denied that credit card usage via the internet had a severe image problem with consumers concerned over the security of their details. He said usage of the channel was increasing and while some consumers had issues with the online environment, the overall perception was positive.

Kwakernaak also said MasterCard was examining new biometric technologies, but was still several years away from adopting them in a widespread fashion.

Iain Ferguson writes for ZDNet Australia