CREDIT CARD users could within two years be using wireless calculator-like devices that will give a unique verification number for all internet and telephone transactions.

The devices are designed to cut fraud carried out when the criminal does not have to present the actual card. All the information needed for this type of crime is printed both on your card and many receipts.

Each time you buy something over the phone or internet, you slot your card into the device and punch in your personal identification number (Pin). Your credit-card issuer then sends a unique number, which you must key in to make the purchase.

This is likely to replace the current practice of asking cardholders to give the last three digits of the code on the signature strip of their card.

Robert Littas, head of fraud at Visa Europe, said: “The industry recognises that it must come up with a more dynamic solution in the long term. This is a very simple method of giving each transaction a different verification code, and it could also be used to improve online banking security.

“Instead of typing in your mother’s maiden name, you would be keying in a one-off code, which would help to prevent criminals accessing your account.”

A version of the technology is being piloted by Barclaycard.The firm’s Ian Barber said: “We have been trialling this technology for about six months and it is not beyond the realms of possibility that it could be rolled out to all customers within two years.

“We know the technology works and the feedback we’ve had from customers so far has been pretty good. However, convincing people to give it a go has been quite hard.”

Management consultant Tim Parrott, who lives in Slough, Berkshire, with his wife, Kate, would be happy to try the new technology if it made life harder for fraudsters.

He became a victim of fraud when his Tesco Visa card was used fraudulently to buy minutes for a pay-as-you-go O2 phone. Parrott, 54, said: “I have always been very careful to keep my card details secure, so I was surprised when Tesco Visa contacted me to ask whether I had bought £150 worth of mobile-telephone minutes.”

The money spent on Parrott’s card has since been refunded by Tesco Visa. However, he believes that more should be done to prevent criminals being able to commit frauds like this in the first place. He said: “When I realised what had happened I immediately cancelled my card. However, I am very disappointed with O2’s lack of an early response to my complaint about the fact that its cursory checks allowed my card to be used fraudulently.

“There seems little point in me being so careful if they are going to be so lax. I couldn’t believe it when Tesco Visa told me O2 would not be investigating the matter further.”

An O2 spokesman said: “Although the card companies refund customers who lose out because of fraud, we bear the actual loss. It is therefore in our interests to do the required checks, such as asking for a cardholder’s address.”