eCommerce Losses to Online Payment Fraud to Exceed $20
Billion Annually in 2021
A new study from Juniper Research has
found that the value of losses due to eCommerce fraud will rise this year, from
$17.5 billion in 2020 to over $20 billion by 2021; a growth of 18% over a
single year. The research found that fraudsters have targeted consumers as they
have increased their eCommerce use; exposing insecure fraud mitigation
processes from merchants who are unfamiliar and unprepared with the continuing
fraud challenges in this market.
The research identified that merchants need to do more to implement fraud
prevention strategies across all of their eCommerce channels, or they will
continue to experience large losses. The use of AI will enable behavioural
biometrics in this area, which will increase security across all potential
fraud channels.
Increased Security Must Not Involve Increased
Friction
The new research, Online Payment Fraud: Emerging
Threats, Segment Analysis & Market Forecasts 2021-2025, found
that while merchants will be keen to reduce fraud rates from their current
levels, they will be hesitant to introduce extra friction into the checkout
process. The report identified that clear messaging around security checks and
automated behavioural analytics leveraging AI are key capabilities in
preserving the user experience.
Research co-author Susan Morrow explains: “While the need for security
is greater than ever, the competitive eCommerce environment means merchants
will need to ensure that extra security checks are justified to the user, or
they risk higher cart abandonment rates.”
China Will Be the Single Largest eCommerce
Fraud Market
The research also found that China will be the largest single eCommerce fraud
market in the world; accounting for over 40% of eCommerce fraud losses globally
in 2025, at over $12 billion. The research identified a massive eCommerce
market and a relative lack of fraud detection and prevention platform
deployment as the key drivers behind this. The research recommends that
merchants operating in China should invest in fraud detection and prevention
now, or they will increasingly face damage to their already slim operating
margins.
Source: Juniper Research media announcement 
