New figures have revealed the first annual drop in fraud losses on UK credit and debit cards since 2006.
According to the UK Cards Association the level fell by 28% in 2009 to total £440.3 million.
The trend followed the introduction of industry initiatives designed to target the problem.
But despite the progress made, online banking fraud during the period rocketed by 14% due to customer account details being obtained by criminals in increasingly sophisticated ways.
Counterfeit card fraud fell by 52% during the year to £80.9 million and was at its lowest level since 1999.
Fraud losses at UK retailers fell by 27%, while UK cash machine fraud was down 20% and fraud on cards that were intercepted in the post dropped by 32%.
But card-not-present fraud, such as the fraudulent use of credit and debit cards to buy things over the internet, telephone and through mail order companies, also fell despite not being impacted by Chip and Pin.
The group attributed the 19% drop to £266.4 million to the use of sophisticated fraud detection tools by retailers and banks, as well as the growth in security systems such as MasterCard SecureCode and Verified by Visa, which make buying things online more secure.
