Fraud Prevention in Ecommerce Report 2024–2025 — Safeguarding the Online with State-of-the-Art Fraud Prevention Strategies
Merchants lost more than USD 48 billion globally in 2023 to online fraud alone, which shows a 16% growth in ecommerce fraud from 2022. A report from Sift mentions that 42% of Gen Z customers are most willing to commit first-party fraud, requesting a refund while keeping the items they ordered online. On the other hand, professional scammers and fraudsters intensify their attacks by deploying higher-accuracy social engineering techniques to prey on merchants’ vulnerabilities.
Given the complex and ever-evolving fraud ecosystem, merchants, PSPs, and customers need a reliable source of information to better understand the weak points that fraudsters prey on and make ecommerce a safer place for everyone.
The Paypers’ Fraud Prevention in Ecommerce Report 2024–2025 is the ultimate source of education into all-fraud related topics, tackling the most important trends observed in this fast-paced industry over the past twelve months. Working together with merchants and businesses to educate on ecommerce’s greatest vulnerabilities, The Fraud Prevention in Ecommerce Report 2024–2025 deep dives into key topics of interest including scams, account takeover (ATO), and payment fraud, as well as behavioural biometrics, promo abuse and refund fraud, or leveraging the use of artificial intelligence (AI) and machine learning (ML).
Setting the scene
Analysing the average cost of ecommerce fraud in 2023, Signifyd found that merchants lost around USD 207 for every USD 100 in fraudulent orders. The losses included wholesale costs, shipping and fulfilment costs, as well as chargebacks and processing fees, leading to a rise in retail prices. 2024 saw a rise in fraudsters’ sophistication, with criminal rings being more active than ever. Combining old techniques, such as social engineering, with new technologies like generative AI (GenAI) and botnets, fraudsters have become harder and costlier to spot.
As consumers continue to heavily rely on online shopping, thus driving the growth of global ecommerce, keeping up with online fraud has proven a difficult task both merchants and solution providers face. From payment fraud to scams, chargebacks, policy abuse, identity theft, and bot attacks, bad actors leverage all their resources to boost their illicit winnings and perpetuate crime online.
Moreover, 2024’s turmoil is a few months from being over, with 43% of people claiming they have experienced at least one type of online fraud. Combined with an all-time high cost of living and an unpredictable global political climate, we might expect surges in friendly fraud, refund fraud, and scams. To stay ahead of fraudsters, deploy the latest technologies in the field, and keep an eye on regulatory updates, we invite you to read the 2024–2025 edition of The Paypers’ Fraud Prevention in Ecommerce Report!
A glimpse into the report’s findings
The Fraud Prevention in Ecommerce Report 2024–2025 — Safeguarding the Online with State-of-the-Art Fraud Prevention Strategies published by The Paypers features an up-to-date overview of the ever-evolving fraud ecosystem. It explores the evergreen topics in fraud, while also raising awareness about the latest trends in fraud prevention, and technologies, with a complex focus on merchants’ needs to stay protected. Download the full report to read more on:
· The most prevalent types of fraud in 2024 and beyond;
· Why scams still work and how can users and businesses alike protect themselves;
· The emerging technologies in fraud, including the use of artificial intelligence and machine learning;
· The role of ID verification and biometrics in safeguarding the ecommerce space;
· Using intelligent decisioning to enhance fraud management;
· Understanding and fighting refund fraud, card-not-present fraud, and merchant fraud.
Fraud in 2024 and beyond — what should merchants expect?
First-party fraud, identity theft, and ATO often go hand in hand with other types of fraudulent activities, including refund fraud and abuse of promotional policies. In their attempt to gain illicit funds, bad customers exploit merchants’ lax policies and vulnerabilities. So, how can merchants protect their business while still rewarding loyalty?
Distinguishing between bad actors and legitimate customers is the first step, followed by adjusting return policies based on the customer’s profile. Knowing the difference between wardrobers, fraud rings, and clients who abuse return policies once is key to enforce strong KYC strategies. By deploying the right tools and constantly training their customer support teams to not give into scammers, merchants can decrease their return rates, build strong brand reputation, and drive revenues.
Original research by The Paypers
Fraud prevention is a multi-billion market globally, encompassing thousands of solution providers looking to meet each merchant’s unique set of needs. The most notable players in the industry are depicted in an in-depth infographic researched and updated by The Paypers. The Fraud Prevention in Ecommerce Report 2024–2025 provides an overview of key companies in the industry, based on a series of solutions they offer, including customer authentication, identity verification, behavioural biometrics, fraud/risk management and decisioning platform, or chargeback management.
Without further ado, The Paypers invites you to download your FREE copy of the Fraud Prevention in Ecommerce Report 2024–2025 and join our growing team of specialists in fraud prevention!
About Irina Ionescu
Irina is a Senior Editor at The Paypers, specialising in fraud and online payments. With a Ph.D. in Economics and a strong economic academic background, she observes developments in tech, innovation, and regulation, educating the audience about fraud prevention, chargebacks, scams, social engineering, digital identity, GenAI, and ecommerce.
