Are Norwegian bank code chips a serious fraud risk?

Robin-Ivan Capar
Robin-Ivan Capar - [email protected]
Are Norwegian bank code chips a serious fraud risk?
Photo by The Local Norway

Bank code chips are widely used in Norwegian society. Now, experts are ringing the alarm regarding the risks associated with the chips.


Although their use is widespread in Norway, code chips have increasingly been associated with BankID fraud cases.

A new research project at the Norwegian University of Science and Technology (NTNU) warns that bank code chips make people vulnerable to fraud – especially fraud involving family and friends, Norwegian Broadcasting (NRK) reports.

NTNU professor Kristian Gjøsteen says that using code chips makes you more vulnerable to fraud compared to using apps and similar solutions.


Bank code chip fraud

In recent years, there have been several cases of code chip fraud in Norway, where fraudsters have managed to obtain the password generated by the code chip for login purposes.

In 2020, a man from Kristiansand who had been a victim of BankID fraud was upheld in the Supreme Court, avoiding a million-kroner debt.

Not everyone is as lucky as the man from Kristiansand, though. According to a report from the University of Oslo (UiO), fraud victims are often left with the debt even if a fraudster ends up being convicted.

Furthermore, research shows that bank code chips are often problematic in cases when people are defrauded by family and friends.

Generally speaking, Gjøsteen thinks the code bricks are too unsafe to use.

"One of the problems is that you use the same mechanisms to approve paying a bill of 250 kroner or take out a loan of 400,000 kroner," the professor noted.

He believes the banks' measures to prevent fraud are not good enough.

"They are obviously not sufficient. The most important thing here is to place the responsibility on those who can do more, and it is mostly not the consumers."


Reasons for keeping code chip technology in place

Finance Norway (Finans Norge), the industry organisation for the financial industry in the country, wants to keep the code chip technology in place because not everyone has a smartphone with an app that allows for secure identification.

A survey from 2021 shows that around 600,000 Norwegians struggled with digital services.

"Those who do not have a smartphone are forced to have a BankID. In such cases, the chip is a very appropriate travel item and easy to use," Gry Nergård at Finance Norway told NRK.

"It is safe in itself, as long as you don't borrow it or get tricked into sharing your password," she pointed out.

As things now stand, the code chip is not planned to be removed from use anytime soon.



Gjøsteen has put forward several proposals aimed at increasing the level of security related to banking services.

"You could add extra checks for large transactions, for example, by calling the person in question or by having a video call."

He says there are technical methods that can be used that provide better safety.

"For example, new technology has arrived in the autumn that can link a device to you via biometrics," Gjøsteen added.

Biometrics could, for example, include fingerprints or face recognition.



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