Mastercard has announced new offerings to its US small business benefits suite to maximize SMBs’ digital presence.

Available across Mastercard BusinessCard and World Elite Mastercard for Business in the US, Mastercard’s enhanced suite of US small-business benefits now includes Microsoft, QuickBooks, and Zoho services.

“Now more than ever, having a digitally-led approach is critical for small business owners. Mastercard remains committed to helping provide small businesses the solutions required to meet the needs of the evolving consumer and operate in our digital world,” said Chiro Aikat, EVP of products and innovation in North America for Mastercard.

Casting light on the new services, Mastercard says its digital offerings and tools will help small business cardholders “sustain their business today and accelerate their growth tomorrow.”

Notable features of Mastercard’s expanded digital suite include Microsoft advertising for driving leads, appointments, visits, or purchases through paid search; QuickBooks Online Payroll management; and Zoho marketing capabilities for growing social media presence, running email campaigns, surveying customers, and more.

Mastercard has also announced enticing discounts on its new offerings. For instance, you can get $125 in advertising credit after spending only $10 with Microsoft Advertising, save 40% on QuickBooks Online Payroll for six months, and receive 50% off one year of Zoho Social.

Plus, Salesforce’s customer relationship management solution Salesforce Essentials, Intuit’s QuickBooks and TurboTax discounts, access to a 24/7 Business Assistant, Mastercard ID Theft Protection, Mastercard Easy Savings, and Mastercard Receipt Management are other interesting Mastercard partner discounts.

The services can be downloaded and activated for free using a valid Mastercard Small Business card in the Apple and Android app stores.

“Many businesses have experienced an accelerated digital transition this past year, and they are now exposed to an array of tools that can help them grow and promote their businesses across digital marketing channels—web, social, email, events and more," said Raju Vegesna, chief evangelist at Zoho.

"We are thrilled to partner with Mastercard to offer our social media management tool and end-to-end digital marketing platform—Zoho Social and Zoho Marketing Plus—so that small businesses can fast-track their growth.

Mastercard and Visa are developing a new authentication solution that will end the need for pesky verification codes when making online payments.

At the moment, before the checkout for an online purchasing process is complete, you're asked to enter a Verified by Visa or MasterCard SecureCode - usually random numbers and letters from a secondary password.

After taking onboard customer feedback, the companies decided to work on a solution that would end the need to remember an extra password in order to complete purchases.

Mastercard said it will use richer cardholder data, so although you may need to input more information in the first step, there's a possibility the second-level authentication will use biometric data or one-time passwords rather than everytime passwords. The company said biometric information could be facial or voice recognition.

The company will also trial wristbands that could authenticate your identity though your heart beat, making use of the power of wearables.

The new technology could roll out as soon as next year, although the new security solution has to go through testing to ensure it's as secure as the current 3D Secure protocol.

Ajay Bhalla, president of Enterprise Security Solutions, MasterCard said: "All of us want a payment experience that is safe as well as simple, not one or the other. We want to identify people for who they are, not what they remember. We have too many passwords to remember and this creates extra problems for consumers and businesses."

Mastercard said payments on mobile devices will be responsible for 30 per cent of all online sales by 2018, making the need for a simple and secure solution all the more urgent.

Apple is believed to have finalised deals with American Express and Mastercard, which will allow users to pay for good and services using the iPhone 6.

The two credit card companies follow in the footsteps of Visa, which was reported to be in talks with Apple in July. All three partnerships are expected to be unveiled at the launch of the iPhone 6 on 9 September, sources have confirmed to Recode and Bloomberg.

Specifics including the name of the payment system, where it will accepted and how it will work remain unknown. However, Apple's Touch ID fingerprint scanner is expected to play a key role in the authentication process and credit card information is expected to be stored on a specific piece of the hardware known as the "secure element".

Apple has so far resisted the temptation to build in Near Field Communication (NFC) into its products despite the technology being a standard inclusion in high-end Android and Windows Phone handsets.

Confirmation that an iPhone mobile payments systems exists means that NFC is now guaranteed to be featured in the next-generation handset.

Contactless payments have grown in popularity, with 19.7 million transactions happening in the UK in May 2014, according to Visa Europe.

With Apple arriving to challenge established vendors like PayPal and Google Wallet, analysts expect this to be a pivotal moment for the mobile payments landscape.

Everything Everywhere has signed a five-year deal with MasterCard to allow mobile payments to be made using near field communication (NFC) technology.

The contactless technology will be the first service to be made available to customers through the partnership.

The two firms said they plan to expand the scope of the deal into other areas, including person-to-person money transfers, loyalty rewards and digital payment services.

The arrangement will also see the two collaborate on developing services for small businesses to take payments using mobile devices.

The companies have been working together for three years on Orange's Quick Tap service, the first commercially available NFC-enabled payments service in the UK, and the Orange Cash prepaid card.

Gerry McQuade, chief marketing officer of Everything Everywhere, said working with MasterCard was an important step in making mobile payments more widely available.

"By moving our existing co-branded card offers onto mobile devices, we are closer to a world where our customers will be able to use their phone to pay for travel, pay for small purchases and take advantage of loyalty rewards from their favourite retail outlets," he said.

Marion King, president of MasterCard UK and Ireland, said the company's "vision" is of a world beyond cash, where consumers and small businesses can benefit from simple payments using smart technology.

"The partnership we are announcing today builds on our strong heritage in the mobile payments space and ensures that MasterCard remains the partner of choice for leading businesses in the UK," she said.

"As the use of cash continues to decline, we will be able to provide Everything Everywhere's 27 million customers with an attractive range of new payment services backed by the processing power and security of MasterCard," added King.

A computer hacker who claimed to have acquired at least 50GB of customer information from credit card companies Visa and Mastercard has apparently backtracked over the source of the data.

As reported by IT Pro, a list of contact details for several hundred people from the US, UK and Austrailia were published on text-sharing website Pastebin yesterday by a computer hacker called Reckz0r.

In a series of posts on social networking site Twitter, he said the data belonged to Mastercard and Visa customers, an allegation both firms declined to confirm yesterday.

No credit card or account numbers were included in the data dump, but the hacker hinted that more information could be leaked in due course.

"I just leaked half [the] data of Visa and Mastercard," he tweeted. "The full one is about 50GB or bigger."

Since then, Reckz0r appears to have backtracked over the source of the data, tweeting that it was not acquired by hacking into Visa and Mastercard's systems after all.

"I hacked the banks," he tweeted. "I penetrated over 79 large banks, [and] I've been targeting these banks [for] 3 months."

At the time of writing, he had not revealed any details about the identity or location of the banks he claims to have hacked.

It is also unclear if the list of contact details released yesterday is legitimate and, if so, if they relate to bank employees or customers.

The tweets were backed up by a statement to IT Pro from Visa Europe this morning where the firm said it had found no evidence that its systems had been hacked.

"Following reports yesterday from a hacker claiming that he had breached Visa and MasterCard's systems, Visa and Visa Europe security teams quickly investigated and confirmed that there was no breach of our systems," said the statement.

"Please be assured that this claim was false and the hacker later corrected his claim on Twitter," it added.

A computer hacker has leaked a list of names, addresses and telephone numbers it claims belong to Visa and Mastercard customers.

In a series of posts on the social networking site Twitter, the hacker who goes by the name of Reckz0r - claims to have infiltrated both companies' systems and acquired their data.

"Guess what folks? Mastercard and Visa are pwned," the hacker wrote. "Don't believe me? Keep your patience, I'll provide a lovely demo for you soon."

The hacker then told followers to expect a "data dump" of the acquired information yesterday.

Since then, Reckz0r has posted a link to a file on the text sharing website Pastebin, which contains contact details of several hundred people from the United States, Australia and the UK.

"I just leaked a half data of Visa and Mastercard, the full one is about 50GB or bigger," the hacker added.

In a statement to IT Pro, Mastercard declined to confirm or deny the authenticity of the data, adding that it doesn't comment on "rumours, threats or speculation."

Meanwhile, in a further statement to IT Pro, Visa confirmed that it was investigating the breach.

"Visa Europe takes data compromise very seriously," said the company. "Working closely with partners, including law enforcement, we are investigating this allegation."

Mastercard has become the latest credit card company to drop payment processor Global Payments from its list of approved service providers, following its data breach earlier this year.

As reported by IT Pro, Global Payments confirmed last month that up to 1.5 million credit card numbers had been stolen following a security attack on its systems in North America.

Up to seven million credit cards could have been affected by the breach.

Global Payments is responsible for processing payments for several credit card companies, including Visa, Mastercard and American Express.

The breach prompted Visa to remove the firm from its list of Payment Card Industry Data Security Standard (PCI DSS) compliant vendors, and now its rival Mastercard has followed suit.

Mastercard confirmed the move in a statement to the Wall Street Journal.

"As a result of the preliminary investigation findings regarding the [Global Payments] breach, MasterCard has removed Global Payments from our list of PCI compliant service providers," the statement said.

Earlier this week, Global Payments issued an update about the breach, stating that "some card brands" had withdrawn its PCI DSS compliant status.

"They have requested we re-validate our PCI status, which we will do following our current investigation," the statement said. "We anticipate that we will be reinstated to those lists."

The Wall Street Journal has also reported that many more card details may have been compromised than first thought.

Quoting sources familiar with the situation, it is claimed that up to seven million credit cards could have been affected by the breach.

Global Payments declined to comment on the claims, except to state that it was still investigating the cause of the breach.

"In any matter of this nature, the card brands cast a wide net to protect consumers and we supply as much information as possible to assist in the course of the investigation," said the company in a statement.

HTC, RIM and Samsung are among a tranche of smartphone makers who have had their devices approved to carry out contactless Mastercard payments.

The handsets are the first to receive the new Mastercard PayPass Ready certification. It is designed to let end users know their devices have been approved for use with the credit card company's contactless payment system.

Mung Ki Woo, group executive of mobile at Mastercard, said: "In the near future, millions of phones will ship with [near field communications] technology embedded within them.

"The new PayPass Ready identifier will [provide] a visual mark that indicates devices are certified to make simple, smart and secure payments via the MasterCard PayPass network."

The devices covered by the scheme include the Blackberry Bold, the Blackberry Curve, the HTC One X, the LG Viper and the LG Optimus Elite. Several members of the Samsung Galaxy, Sony Xperia and Nokia smartphone families have also won Mastercard's approval.

Andrea Bacioccola, NFC lead programme manager at Nokia, said the firm was pleased with the Nokia Lumia 610's inclusion in the list.

"This sends a clear message to operators, banks and other service providers that Nokia is able to quickly enable their payment services on this smartphone," he said.

Andrew Bocking, senior vice president of software product management at RIM, added: "[The branding] provides consumers with a visual confirmation that an NFC-enabled BlackBerry smartphone can easily be [used] with a MasterCard account for tap-and-go payments."

MasterCard has made it safer and speedier for consumers to use its payments system thanks to a partnership with IBM that enables new products, such as regulatory and fraud-fighting tech, to be added to its network quickly and easily.

We pack more than 100 pieces of information into that message. Then it starts its journey to the network. It doesn't leave any time for error.

Previously, creating new products with rules and logic to apply to certain situations or patterns of behaviour could take weeks, months or years to develop, approve and embed. However, now, the payments giant can do so in a matter of hours for new rules, and mere months or less for new products.

"We need that platform in order for us to innovate," Johan Gerber, group head, of processing product management at MasterCard's global network products division told delegates at IBM Impact today in Las Vegas.

"Innovation is what we need for differentiation. Staying ahead of the competition is key"

MasterCard's network has to support 1.7 billion consumers, across 22 financial institutions and some 32 million merchants. Coupled with this volume of 'users' transactions can be carried out in 150 currencies across 210 countries.

The average speed of a transaction is just 130 milliseconds and the system has to be able to cope with 43,000 transactions per second, according to Gerber.

"We pack more than 100 pieces of information into that message. Then it starts its journey to the network. It doesn't leave any time for error. Protection and security are critical for us. We can't afford for the network to go down. Even our network's backup has a backup," he said, adding that the system is capable of handling as many as 14 billion instructions every second.

"We have established a technology layer with its roots into our network. It begins feeding in from our data warehouses and other areas. [Working with IBM] we have created a layer on which we can position new and innovative products. The foundation is safe, secure and stable."

If you took the data housed in its data warehouse and placed on bookshelves, these shelves would stretch more than 54,000 miles, Gerber said.

MasterCard has a history of working with IBM, having previously deployed WebSphere, specifically its Message Broker and ILOG functionality. The new technology layer created by this partnership went live in February this year and, since then, the company has been able to implement new business rules management and transactional blocking capabilities.

"How do we innovate within an environment like this? We can now provide thought leadership to the industry and do new things much faster," Gerber added.

"We dream big. If we can get all of this right maybe our future and the future of shopping might look [very different]."

Every day, thousands of commuters use near field communications (NFC), although most may never realise it.

NFC is at the heart of London's Oyster card, is already built in to many Visa debit cards, and is being used to pay for small-value transactions from Spain to Hong Kong.

And recent developments, especially from the mobile phone manufacturers, are making NFC even more mainstream. Google Wallet, the BlackBerry Bold 9900 and the Google Nexus S all feature NFC. There are strong rumours that NFC might be built into the iPhone 5, when it comes out later this year. And NFC is set to be included into other devices, including tablets and even smart TVs. The market could be worth $670 billion - 420 billion by 2015.

The technology behind NFC is not actually that new. But the way that developers, manufacturers, enterprises and, importantly, marketing executives is changing.

At its core, NFC is about contactless data transfer to and from devices. This has a number of applications. The most common is payment, using a phone as a debit or credit card by touching it to NFC readers at tills or pay points. But it has wider uses.

"We've been talking about payment and transit but that's not the only thing NFC brings to the table," says Charles Dachs, director of product management for mobile transactions at NXP, a developer of NFC technology.

Cashing in on cashless

"Essentially we talk about NFC in three ways: replacing the cards in your wallet, discovering content using your phone as a content reader, and peer-to-peer a device-to-device exchange of information."

As an example, NFC could be used to link Bluetooth devices to peripherals like headsets. A phone could be synchronised to a headset just by physically "bumping" them together.

Certainly this kind of functionality would be very attractive for consumers, but businesses might need greater incentives to adopt NFC. Dachs believes this lies in the content reader and peer-to-peer elements of the technology.

"It's about more than just using your phone as a card, it can provide a much richer experience with targeted marketing and direct marketing," he says.

The most obvious marketing application is in digital coupons from purchases, or NFC readable posters. Vouchers would be redeemable on a consumer's phone.

According to Dachs, part of NFC's potential lies in making marketing methods more comfortable and less intrusive for the consumer and, in turn, making them more effective for businesses to deploy. No-one likes marketing emails and spam, but directly interacting with advertising in our daily lives might be more fruitful for both sides.

Another appeal for marketers is the low cost of deployment: "It doesn't need to be point of sale. Contactless tags and stickers cost literally pennies," says Dachs. Marketers could, he suggests, try mass deployments of interactive content in magazines and posters, and hope for a good return for a minimal investment.

NFC usage could also grow organically, with manufacturers such as RIM putting out NFC capable handsets and the relevant application programming interfaces (APIs) for developers. As NFC supports direct "bumping" of data between handsets, popular apps could spread "virally" between users. In turn, this could cement the appeal of NFC with marketers and developers.

More, though, needs to be done to make NFC a mainstream business tool.

According to Rob Bamforth, analyst for Quocirca NFC has potential as a payment method. But "doing something useful" with the technology in business processes and transactions will remain "one of the hardest parts."

"It's not so much the technology itself but how you get it to the right level of ubiquity and ensure that the commercial elements are lined up," he says. "Standardisation is a definite requirement."

The take up of NFC is also likely to grow, Bamforth believes, if the technology reducing the risk and operational costs of transactions is a major factor in Bamforth's view.

"It has to be lower transaction costs," he says. "It's no good if it's the same fees [as credit cards] to Visa or the banks and so on, it needs to have a reduced cost per transaction."

In recent years the average value of credit card transactions has fallen. Consumers are making lower-end purchases with their credit cards, and this is something merchants and banks would rather avoid. NFC payments could fill that gap, leaving credit cards for original use, as a way of paying for more expensive goods and services.

One positive aspect of NFC for retailers is support for automated audit and fraud components. Payment activity via NFC can be fully audited, managed and controlled digitally. Having an audit system that is more economical and accountable through automation will certainly appeal to businesses.

"NFC is only a way of connecting the end part of the process," says Bamforth. "What's important is how the technology interfaces with a business process and how it can alleviate the more costly and fiddly elements".

"It needs to be universal," he adds. "The last thing we want in NFC is separation into systems that don't worth with each other."

Counting the cost

In terms of investment, the upfront costs to businesses of NFC could be relatively small; more modern point-of-sale systems, for example, often already support NFC.

"The big [cost] element is the back-end systems, the IT processes and process handling," says Bamforth. "In reality the [financial] impact is more in the infrastructure network."

However, Dachs suggests much of the infrastructure groundwork had already been done.

"There's a legacy infrastructure for transit which is widely deployed," he says. "Banking is then the easiest one, the infrastructure deployed is completely standardised through Visa, Mastercard and so on, and NFC is established as part of that."

"Some merchants in the US, such as McDonalds, have contactless payment machines already and can use exactly the same models for NFC. The majority are hardware ready," he says.

Dachs points out that software upgrades might need some investment but overall, the costs for most businesses will be minimal.

Even so, the fringe nature of NFC could still act as a deterrent for businesses. To succeed, the component parts of NFC need to come together in a cohesive and usable way.

At Quocirca, Rob Bamforth believes that the different groups interested in NFC need to do more to move in step. "I must admit, I thought we'd be further on by now," he says.

Dachs agrees that for NFC to succeed, it still needs more effort. But he is optimistic about the current level of interest and investment in NFC technologies.

"First there are the manufacturers such as RIM, Nokia, Samsung, and Google. There is no manufacturer that is not looking at this technology," he says.

"With network operators it's the same thing." Orange, for example, has been promoting NFC across Europe including in the UK, as has Telefonica, the parent company of o2. O2 also has plans for the UK market.

"The UK NFC infrastructure is growing for payment," says Dachs. And he believes convincing end-users should not be a problem.

"It's very easy to educate the consumer to use their phones for payment," he suggests. But the longer-term success of NFC will depend on its adoption at the enterprise level.

Donations to WikiLeaks can now go through Visa and MasterCard, a partner of Julian Assange's enterprise has revealed.

On 7 December, DataCell's payment gateway, provided by a company called Teller A/S, blocked Visa and MasterCard payments on the request of the credit card companies.

Last month, DataCell, a WikiLeaks partner, announced it was planning to file a complaint with the EU Commission on the decision to block payments to WikiLeaks. It also planned to commence a lawsuit in Denmark to claim damages.

Without contacting DataCell, it appears Visa and MasterCard have allowed payments to WikiLeaks, albeit through a gateway provided by a different company, not Teller A/S.

"We have observed that an alternative payment processor that we have contracted with, has in fact opened the gateway for payments with Visa and Mastercard, and now also for American Express Card payments, which is an option we did not had before," explained DataCell chief executive (CEO), Andreas Fink.

"We choose to interpret this, as that Visa and Mastercard has in fact given in to our demand that the payment services was reinstated. In other words DataCell is happy to report that we are now able again to process donations to Wikileaks."

Despite the developments, DataCell said it would go ahead with the lawsuit in Denmark and most likely still lodge a complaint with the European Commission.

When Visa and MasterCard started blocking payments to WikiLeaks, hacking group Anonymous responded by targeting the two firms, taking down the latter's website.

Tis the season to acquire

It seems some of the world's tech giants have decided to treat themselves this Christmas with a number of acquisitions.

First off, Google did a double buy, picking up Phonetics Arm and Widevine.

However, the search giant had an up and down week, after revealing Chrome OS laptops would not arrive before the end of the year.

Later in the week, Dell revealed it was in talks to acquire storage software company Compellent.

And then there was Salesforce.com's purchase of Ruby platform-as-a-service provider Heroku for a whopping $212 million.

The announcement was made at Dreamforce 2010, where IT PRO has been reporting from.

Tablet talk

Plenty of excitement surrounds the next iteration of the iPad as reports suggested it could be ready by February. As for new features, it appears a camera will be added.

RIM said it would be offering free tablets to developers who submit successful apps before the PlayBook's US release date.

Earlier in the week, the manufacturer said the software to feature on the PlayBook will soon find its way onto BlackBerry devices as well.

Intel, meanwhile, said it hopes its chips will feature in tablets next year.

When will WikiLeaks weeks end?

Of course, it was pretty difficult to stay away from any WikiLeaks news this week.

DataCell, a company which facilitates payments to WikiLeaks, said it would be taking legal action against Visa and MasterCard. DataCell claimed it had lost revenue as Visa and MasterCard suspended processing of donations to the whistle-blowing website.

WikiLeaks supporters have gone after companies such as MasterCard who have pulled services to Julian Assange's site, launching a number of DDoS attacks.

See IT PRO's analysis of the WikiLeaks threat to see whether your business could be affected by DDoS attacks.

The company which facilitates payments to WikiLeaks is taking on the big guns of the credit card industry in an attempt to open up payment processes once more.

DataCell has announced it will be taking "immediate legal actions" against Visa and MasterCard, who have both this week suspended processing donations to the whistle-blowing website.

The company claimed it was loosing revenue due to the payment suspension, as well as WikiLeaks losing donations.

"DataCell is only doing work for Wikileaks in helping them processing credit card payments," said Andreas Fink, chief executive (CEO) of DataCell. "We are helping an honourable organisation to get its funding it needs to sustain the load on their servers and deliver the messages the public wants to read."

He claimed the blocking of payments by Visa and MasterCard could severely damage the two companies' reputations and make them lose customers.

"This might be very well the end of the credit card business worldwide," he added.

The legal action is just the latest issue faced by the companies who have become targets of WikiLeaks supporters.

A hacker group calling themselves Anonymous' targeted MasterCard's website yesterday with a distributed denial of service (DDoS) attacks and successfully took the site down. Reports suggest Visa's website could be the next target.

WikiLeaks is responsible for leaking the contents of confidential US Embassy cable communications to a number of newspapers around the world, including The Guardian in the UK.

Founder of the website, Julian Assange, was this week arrested in London after he was accused of committing sexual assault in Sweden back in August. The Australian has been refused bail and is waiting to fight against an extradition order to send him back to Sweden.

The website of credit card heavyweights MasterCard has been taken down in what appears to be a revenge attack for the company's stance on WikiLeaks.

Earlier this week, MasterCard confirmed it would not be processing donations made by its cards to WikiLeaks the site responsible for leaking a number of confidential US Embassy cable communications to the public.

It now seems to have become the latest target of the WikiLeaks-supporting hacker group Anonymous,' who claimed to have launched a distributed denial of service (DDOS) attack on the company's website.

A post on Twitter from the group, which goes under the username @Anon_Operation, said: "WE ARE GLAD TO TELL YOU THAT http://www.mastercard.com/ is DOWN AND IT'S CONFIRMED! #ddos #wikileaks Operation:Payback(is a bitch!) #PAYBACK."

We contacted MasterCard for comment but it had not responded to our request at the time of publication.

If the attack has been launched by Anonymous, MasterCard will join the ever increasing list of WikiLeaks enemies' being targeted.

PostFinance, the Swiss bank which blocked payments to WikiLeaks, has already fallen victim to Anonymous and the group has claimed it will target PayPal after the service also suspended transfers to the site.

Julian Assange, the founder of WikiLeaks, was yesterday arrested in London, accused of sexual assault, which allegedly took place in Sweden back in August. He is now fighting against extradition back to the country.

Hackers have managed to copy the Verified by Visa and MasterCard SecureCode protection features in order to dupe customers at 15 top US banks, a security firm has warned.

Once a secure online banking session has been started on an infected computer, a Zeus Trojan will inject the credit card security program facsimiles into the customer's browser, Trusteer said.

The user will be asked to enter their social security number, credit card number as well as its expiration date and PIN or Card Security Value code.

The fake security programs will also attempt to trick people by claiming that new Federal Deposit Insurance Corporation rules require them to sign up to the Visa and Mastercard services.

This data is then sent back to the hackers who will use it to carry out card not present' transactions with retailers using the Verified by Visa and MasterCard SecureCode services.

By impersonating victims, the fraudsters are able to avoid detection.

"While some users may become suspicious when prompted to enter their credit/debit card information as part of the online banking login process, this attack uses the familiar Visa and MasterCard online fraud prevention programs to make the request appear legitimate," explained Amit Klein, chief technology officer of Trusteer and head of the company's research organisation.

The Zeus Trojan has been the cause of plenty of security worries in recent times.

One in every 100 computers is infected with Zeus, according to Trusteer, and earlier this year RSA Security warned that almost 90 per cent of Fortune 500 companies in the US could have been affected by the malware.

Cambridge researchers have cast doubt on extra credit card security measures in a paper published this week.

Highlighting both MasterCard SecureCode and Verified by Visa, Ross Anderson and Steven Murdoch from the Computer Laboratory at Cambridge University, claimed the 3-D Secure technology "breaks many established security rules" when purchasing online.

Firstly, the two researchers claim it confuses users who have become used to the traits of Transport Layer Security (TLS).

"Browsers have introduced measures to help customers, such as changing the colour of the address bar if TLS is enabled, and making it clearer who the domain name belongs to," the report claimed.

It added: "Because the 3DS form is an iframe or pop-up without an address bar, there is no easy way for a customer to verify who is asking for their password. This not only makes attacks against 3DS easier, but undermines other anti-phishing initiatives by contradicting previous advice."

The report also criticised how a user first establishes their password as rather than sending it to a registered address, it is done the first time a card is used online. It also means the user will be keen to get the purchase finished so often wont pay much attention to terms and conditions they are agreeing too, allowing banks to "shift liability to customers."

The researchers concluded from all of these points that "customers receive little benefit in security, while suffering a huge increase in their liability for fraud. They are also trained in unsafe behaviour online."

As a result, they are calling for banks to spend more on setting this system up to make it safer and urging new regulation from the likes of the EU to ensure people follow the rules.

"Circumventing security procedures is, as always, a focus for criminals and we value the input of academia in verifying the effectiveness of security features and systems," A Visa spokesperson said in a statement issued to IT PRO.

"Visa does not however, wholly agree with the premise and conclusions set out in the new paper by Cambridge researchers, which describes theoretical scenarios in which they believe Verified by Visa could be compromised."

We also contacted MasterCard for comment but the company had not responded to this request at the time of publication.

Heartland Payment Systems, the US payment processor that suffered a massive security breach leaving customer transactions exposed, lost $12.6 million (8.4 million) in costs directly related to the intrusion.

According to an earnings conference call transcript, chief executive Robert Carr said that more than 50 per cent of the expense related to a fine that Mastercard assessed against Heartland's sponsor banks.

"Obstensibly because of an alleged failure by Heartland to take appropriate action upon having learned that its computer system may have been breached," Carr said.

However, the chief executive claimed that Heartland responded properly to the possibility of a computer breach and took "immediate and extraordinary" action to address the breach.

Carr said that Heartland was going to "vigorously contest" the size of Mastercard's fine.

Heartland found out about the breach in January last year, notifying law enforcement as well as the card brands involved, with the data taken enough to have been used to duplicate cards.

However, there was good news for the beleaguered credit card processor, as earlier this month it returned to Visa's list of PCI DSS compliant service providers after being taken off in March.

Carr suggested that it could be a wake up call for other companies involved in securing card holder data, as Heartland would go beyond' the PCI standard and were on schedule to introduce a fully encrypted end-to-end terminal solution.

Online fraud has taken a bigger bite out of internet retail revenues in the last year, with 40 per cent of merchants seeing their rate of fraud loss increase.

This was according to figures from the fifth annual CyberSource UK Online Fraud report. One in eight businesses suffered fraud losses in excess of five per cent of their total online revenues, while rates of loss which were more than one per cent of revenue were increasingly common.

Overall the rate of fraud increased by 2.6 per cent, but the cost of fraud could not be measured in direct losses alone more than a fifth of merchants rejected over five per cent of orders on suspicion of fraud, with some of these orders likely to actually be valid.

Retailers also had to deal with the costs of various anti-fraud tools, as well as having to employ new staff or outsource new service providers.

Dr Akif Khan, co-author of the fraud report, said in a statement: "There are hopes for promising new anti-fraud developments coming from government.

"But even with this kind of support, the merchants' principle protection will for the most part, remain the tools and programmes they can assemble in their defence."

The report described some of the anti-fraud schemes that retailers had invested in to tackle the problem of fraud.

It showed that support for Verified by Visa and MasterCard SecureCode had been the most popular, with 16 per cent of merchants integrating them in 2008.

Around 60 per cent of UK merchants employed these services. Surprisingly however, 10 per cent of merchants still used manual reviewers to identify fraud.

Dr Khan warned that manual reviewing was both expensive and inefficient, especially in the challenging economic conditions of today.

He said: "Merchants should be looking to improve the use of automated fraud screening processes so that they only need to review those orders that are flagged as suspicious."