Security: Tag the tab

Related tags Credit card Public house Credit card fraud Fraud

Many pub customers leave their credit card behind the bar, but are they aware of the security risks they face?Running a tab has been part of pub...

Many pub customers leave their credit card behind the bar, but are they aware of the security risks they face?

Running a tab has been part of pub culture for a long time. And with people eating out more in pubs, it's a growing custom. Where once barstaff used to keep a tally of the bill being run up, customers today are more likely to put their credit cards behind the bar. It's all part of progress, of course, but this system comes with serious security implications.

Credit card fraud topped £400m in the UK last year. The largest and fastest-growing kind of fraud is theft of details used to buy things over the phone and on the internet. The next biggest is "skimming" - copying data from one card's magnetic strip onto another.

According to APACS, the body charged with tackling card fraud, these crimes are most likely to be carried out by unscrupulous staff in pubs, restaurants and petrol stations - and its official advice to customers is not to let their card out of their sight.

In other words, they should never leave a card behind the bar while running up a bill. You might think that it's up to the individual customer to take the risk, but from January 1, 2005 the responsibility will be borne by the licensee. Alongside the introduction of Chip & PIN card verification, liability for fraud switches from banks to retailers from that date.

Lockable cabinet

The problem was brought home to entrepreneur Chris Holloway one lunchtime when he was entertaining his bank manager at his local. A new member of staff insisted on keeping his credit card, Chris objected, an argument ensued and he didn't go back to the pub for a month. That set him thinking about a solution - and what he came up with is head-smackingly obvious.

CardsSafe, the product now on trial in dozens of pubs and bars across the country, is effectively no more than a miniature lockable filing cabinet. There's no computer, no fancy electronics involved, just ordinary locks, keys and drawers.

The box is fitted to the wall behind the bar, preferably in full view of customers. Staff lock away credit cards in one of the drawers and hand over a personal key. When customers order food and drink they simply give their key number and it goes on their bill. They settle up by handing back the key in exchange for their card.

Chris got a couple of friends on board, took out a worldwide patent and arranged financial backing from venture capitalists Alchemy to build and market the cabinets.

The initial pilot was carried out at Wizard Inns and trials have taken place with JD Wetherspoon, Barracuda, Massive, Interpub, SFI, a couple of Punch tenancies and Manchester brewer Hydes which is extending the idea to all its food-led pubs.

"We have had no negative reports so far," says Chris. "Everyone says they love it. It's a more professional system than putting cards in a jug and there's no embarrassment factor.

"There's always this grey area of suspicion as far as staff are concerned and this does away with that. Staff love it and so do the customers - it shows the pub is looking after their interests. It even makes a kind of ceremony of the whole process, a ritual of paying by card."

Because customers feel more secure about leaving their card behind the bar, pubs where CardsSafe has been installed find more people are running tabs - and consequently spending more.

At the Prodigal in the City of London, CardsSafe has been trialled since April this year. Manager Siobhan Kiamia-Cucina began with three 10-drawer cabinets and has already had to increase that to five to cope with demand for tabs.

"We are doing 50 per cent more card transactions than previously and get an increased take of 50 per cent from each card," she says. "Now we have advanced authorisation from customers we can allow them to spend more. A tab can reach £500."

Card spend now accounts for 70 per cent of take at the Barracuda pub, which highlights another advantage - less cash in the tills.

"Customers asked a lot of questions about it when we started and we find it's a good conversation-starter with new customers," says Siobhan. "It's a way of getting to know them.

"More people are setting up tabs, especially at lunchtimes. We used to keep all the cards in a box on the back-bar and attach the bill to each one with a paperclip. CardSafe has made us more professional. It's easy for barstaff to use, cuts queues and stops any abusive insinuations from people about what happens to their cards.

"The key seems to be that it makes customers not only feel safer but a little more important too. It means they stay longer, spend more and return. We're amazed nobody thought of it before."

Pictured: Siobhan Kiamia-Cucina demonstrates the CardSafe system.

Customers' bills bigger on card

Plastic is increasingly becoming the way to pay - even in pubs. Visa estimates that 15 per cent of spend at the table and at the bar is by credit card. When people pay by card they spend 30 per cent more - that adds up to £6,000 per pub per year.

This is expected to increase with the introduction of the Chip & PIN method of card verification which has begun to replace signatures and aims to improve credit card security.

But Chip & PIN won't tackle what the industry calls "card-not-present" fraud over the internet and the phone, and fraudsters can still steal identities and card numbers.

Catering for a safe delivery

Ever worry about early morning food deliveries left outside the pub? A solution, specifically designed for caterers, has been on trial in the UK this year.

Homeport is a device that fixes onto the wall and can be linked to one or more lockable boxes. It can be operated by a smartcard or PIN.

Suppliers can leave goods in the box and lock it, preventing theft and satisfying food hygiene requirements.

Further information

For further information on the security companies andorganisations mentioned on these pages, contact: