Ranging from news articles to recent CEO interviews.
With retail fraud exceeding $30 billion and international merchants experiencing more than double the fraud of domestic-only remote channels, Payscout emphasizes the critical need for effective online fraud protection.
(Los Angeles, CA) January 3, 2017 — According to data by Radial, cross-border ecommerce is proven to be much more susceptible to fraud than domestic ecommerce. The data, which covers over 100 clients in eight different verticals and over 100 million transactions, showed that cross-border ecommerce was riskier. LexisNexis data confirms that international online/mobile channels suffer 2.5 times more successful fraud than domestic-only remote channels.(2) Cleveland Brown, CEO of leading global payment processing provider Payscout, Inc., said these findings underscore the importance of risk analysis and fraud management for global ecommerce merchants.
According to Business Insider, U.S. retailers lost roughly $32 billion to fraud in 2014—a 39% increase over the $23 billion in fraud losses the prior year.(3) LexisNexis reports that international merchants with ecommerce/mcommerce transactions have the highest fraud costs as a percentage of annual revenues; their costs are nearly 22% higher than the average multi-channel merchant, and 85% higher than international merchants that operate physical stores only.(4)
“While fraud remains an ongoing challenge for all retailers, these findings suggest that cross-border merchants should be particularly diligent in their efforts to combat fraud—both to prevent financial losses and to reassure consumers their data is secure,” said Brown. “This means addressing fraud on multiple fronts and using layered solutions.”
International merchants contend with several types of fraud; those with e/mcommerce channels attributed 30% of their losses to friendly fraud, 30% to lost or stolen merchandise, 22% to identity theft and 17% to fraudulent requests for return/refund.(4) Retailers also have to protect their customers’ information from cyber attacks and data breaches, and they need to avoid declining legitimate transactions on suspicion of fraud. Among large cross-border merchants, 31% of declined transactions turned out to be false positives.(4)
The good news is that multi-layered fraud solutions have the potential to reduce false positives from roughly 1 in 3 to 1 in 5, and to cut the average monthly number of successful fraud attempts by more than half.(4) Brown notes that international merchants can mitigate their fraud risk by starting with a secure payment system and building on that foundation with comprehensive online fraud protection. By providing global payment solutions for merchants in all risk verticals, Payscout has built a best-in-class suite of fraud protection tools that can support any global entrepreneur.
“Effective fraud management is every bit as important to a web-based business’ success as transaction and payment processing,” Brown explained. “That’s why in addition to providing ecommerce merchants with a robust, flexible and secure payment infrastructure, Payscout assists them with advanced fraud protection solutions.”
Payscout’s managed risk analysts support thousands of clients on six continents with a range of proven tools and strategies, from automated fraud screening and manual reviews to risk management assessments and performance audits. “We maintain a global knowledge network that helps identify new fraud trends before they impact our clients’ businesses, ultimately enabling ecommerce merchants to accept more good orders and reduce their risk of fraud,” concluded Brown.