The report says that the cost of credit and debit card fraud dropped by 23% during the six months to the end of June - compared with the same period in 2008 - to £232.8 million, with losses on card-not-present fraud falling for the first time ever.
But although overall card fraud was down, the cost of online banking fraud jumped by hefty 55% to a record £39 million.
The research group attributed the reduction in card fraud to a raft of measures that have been introduced to crack down on the problem, including the introduction of chip-and-PIN cards, as well as technology such as Verified by Visa and MasterCard SecureCode to make it harder to use stolen cards over the internet.
But, said the group, the dip may also have been caused by fraudsters targeting cards issued in countries that do not yet have the chip-and-PIN system in place, and whose currencies are stronger than Sterling.
FFA-UK said that UK fraud losses on foreign-issued cards used in the UK jumped by 36% during the first half of the year to £81.1 million.
Fraud losses on cards used at UK retailers fell by 26% during the six months, while fraud on cards lost in the post was down by 33% and losses on lost/stolen cards dropped by 6% to the lowest level since the industry started collecting data back in 1991.
Losses on phone, internet and mail order shopping fraud, meanwhile, recorded their first ever decline of 18% to £134 million.
FFA-UK added that there were also more than 26 000 reported phishing incidents - a 26% jump compared with the same period of the previous year.