Published October 20, 2017

Transaction fraud is incredibly costly. Studies have shown, that for every one dollar lost to fraud, online retailers lose and additional two dollars before the problem is delt with.1 Fraudsters can hide their identity and walk away with thousands of dollars in services or merchandise, often ordering from overseas and using a stolen credit card so they are difficult to catch. On top of that, storeowners can end up paying twice over when the real customers demand their money back, leaving the business to deal with weighty chargeback fees and having to dedicate hours of employee time to dealing with the problem.

Or as a report from Javelin Strategy and Research explains:

“Fraud costs merchants more than 7.5% of their annual revenue… Digital goods merchants suffered the worst losses, at 8.6% of revenue on average, but hybrid goods merchants faced similar costs at 8.1% of revenue.” 2

Each year, transaction fraud gets costlier as the scammers develop new ways to mask their intentions and pocket your hard-earned money. The solution to this is to assess each of your site’s users for potential risks – identifying red flags for possible fraudulent users so you can escalate the orders with SMS verification or even block them entirely before they impact your bottom line.

References

NS8 Complete Storefront Protection

Protect your storefront from order fraud and the other revenue killers.

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