Fraud Increasing In Ecommerce, But Help Is On The Way

By Brian Kelly, Multichannel Merchant Used with permission from Radial

From account takeover to friendly fraud, phishing, spoofing, counterfeiting, chargebacks and more, there are many ways for fraudsters to disrupt and derail ecommerce. This is a major thorn in the side for retailers and honest customers alike. However, despite some depressing trends in fraud, this is not a doom-and-gloom situation. There are many robust solutions and services available to retailers. We’ll take a look at some current fraud trends and explain the best ways to safeguard against those threats.

Ecommerce, bolstered by consumer avoidance of brick-and-mortar locations during the pandemic, continues to grow at record rates. U.S. ecommerce sales are projected to continue to soar by double digits, skyrocketing up 17.9% in 2021 to $933.30 billion, according to the U.S. Ecommerce Report 2021 from Insider Intelligence. Ecommerce penetration will also continue to increase, more than doubling from 2019 to 23.6% in 2025.

Fraudsters, bad actors and assorted criminals will continue to try and get their share of that legitimate commerce in an illegal fashion. While the overwhelming reason to engage in ecommerce is to grow revenue, at least 42% of retailers say they’re doing so to improve customer service, according to Gartner. Unfortunately, it’s a fact that a retailer’s revenue, brand reputation and customer service ratings will take a hit when fraudsters get through their defenses.