The spread of chip and PIN - which requires people to type in their card numbers when making purchases - helped lead to a 13 percent fall in credit card fraud in the first six months of 2005, the first significant fall for 10 years, APACS said.
In sharp contrast Internet, telephone and mail order fraud - collectively known as "card not present" crimes - went up by 29 percent to 90.6 million pounds with online fraud accounting for 64 percent of this.
"The majority of this type of fraud is card details being stolen in the real world and then used to buy goods on the Internet," said APACS spokesman Mark Bowerman.
APACS, the trade association for organisations that deliver payment services to end customers, said 117 million of Britain's 140 million payment cards have been upgraded to chip and PIN since the programme began in late 2003.
Malcolm Coles, editor of consumer magazine Which?, said more than half of Britain's 42 million cardholders put themselves at unnecessary risk of fraud by failing to perform basic security measures.
A fifth of cardholders surveyed by Which? said they did not check their credit card statements properly and a fifth said they would give their account details out to a stranger on the phone if that person claimed to be phoning from their bank or credit card company.