You don’t want to lose money due to online fraud, do you? Then you better buff up your FDP-solutions, because retailers are expected to lose $ 130 billion in CNP-fraud in just the next 5 years.
As online shopping and digital solutions are becoming more common, we are also seeing a rise in online fraud, and the no-good-doers are getting more creative every day. As an online retailer, you, therefore, need to increase and expand your Fraud Detection and Prevention (FDP) measures in order to keep the bad guys at bay and prevent your business from sustaining heavy losses in the upcoming years.
E-commerce sites need to invest in secure purchases, that will then reduce lost revenue and increase consumer trust.
If you are like most eCommerce merchants, you have probably focused mainly on detecting fraud at the point of transaction. This makes sense since this used to be the place where fraud was common, and it’s was also fairly easy to detect certain types of fraud there. But nowadays the fraudsters have become better at hiding their intentions, and you need to look for suspicious behaviour earlier during the session in order to identify them. Catching them with their hand in the digital cookie-jar simply isn’t as easy as it used to be.
The reason why most online retailers don’t invest in a multi-layer FDP is that it seems like a waste of money. There is a perception that an advanced system like that can only detect fraud, and thus it makes little sense investing in a costly system that only does one thing. It can sometimes also be hard to calculate the exact amount of money lost to fraud, so calculating the ROI of such a system becomes trickier. But now that a recent study from Juniper Research indicates a potential loss of $ 130 Bn the coming five years in Card Not Present (CNP) fraud alone, getting a better system might prove to be a good investment after all.
There are also added benefits of having a better FDP-system in place. One of the authors at Juniper Research, Steffen Sorrell, explains, “A layered FDP solution naturally helps directly preventing fraud, but it also offers major gains in terms of recovering potentially lost revenue through false positives. This is something about which retailers remain undereducated, and has allowed fraudsters to capitalize on relatively low FDP spend,”
This means that a well implemented FDP-solution will quickly earn its money back. And not just by preventing fraud, even though the staggering losses Juniper Research calculate might be enough already, but also from increasing consumer-trust.
So, by having a multi-layer FDP you can build a secure and trustworthy shopping experience for your customers. And trust me when I say this: online-shoppers love a retailer they can trust. If you are worried about the ROI, fret no more, buffing up your anti-fraud system will quickly prove to be a good investment for both you and your customers.
Covr Security AB, located in Malmo, Gothenburg, Stockholm, Frankfurt and Palo Alto, is a Swedish cybersecurity company. We have developed a next-generation, user-centric mobile security management app for a wide range of heavily regulated digital industries that depend on strong customer authentication and privacy. The Covr app is available both as an off-the-shelf authentication mobile app ready for a quick launch, and as a powerful SDK for hassle-free integration into existing mobile applications