Time is ebbing away for small retailers to insure against losses due to payment card fraud.

From January 1, 2005, retailers who have not installed chip and pin reading equipment will have to take full responsibility if they are the victims of fraud.

This may come as a shock to some small retailers like those in Brighton's North Laine, who have high rents and have experienced a second year of poor profits.

Almost half of all retailers have still not converted to the new system and most of these are small independent traders.

The Forum of Private Business is calling on banks and credit card companies to allow retailers more time to install chip and pin machines.

It claims it has been difficult for smaller traders to make the transition because of a lack of resources and finance.

Banks will not accept liability or offer compensation to retailers suffering from fraudulent use of cards after January 1. Only those who comply with card issuers' instructions under the new system will be covered.