Barclaycard credit card services to battle online fraud

Barclaycard credit card services is working with banks and retailers to develop a new mobile security device aimed at tackling online fraud.

The device, which works in a similar way to chip and pin technology, will require consumers to insert their card and type in a PIN to confirm their identity.

After verifying the number, the calculator-sized machine will issue a unique eight-digit code that consumers have to enter online.

A Barclaycard spokesperson told the Times newspaper that the company has completed trials of the security device. It is now in talks with large-scale retailers to introduce the scheme nationally.

Barclaycard suggested that the security devices would be given to its customers free of charge so that all their customers can participate in the scheme.

Online shopping is set to account for about 30 per cent of all retail sales by 2010 and the sector has been long-awaiting a fraud solution.

Online fraud rose by 24 per cent in 2004 to £150 million.