Taking a Look at the Latest Payment Fraud Statistics in 2022

Are you planning on starting an online eCommerce business?

If so, you have to consider the possibility of payment fraud and how it’ll affect your business. Payment fraud is a great threat to your business and can cause you to lose money after scammers have already received your products and services.

So what are the major instances of payment fraud in 2022 so far? What do you need to know to prevent a fraudulent transaction in your business?

Here’s what you need to know:

What You Should Know

Almost half of online businesses, both small and large, have dealt with at least one fraudulent transaction since 2020. This has included a balance of internal and external fraud.

This means that some of the fraud was attempted by outsiders not associated with the company. This can include customers, professional scammers, and even competitors.

Internal perpetrators can include employees of the company, shareholders, or even members of the board of directors!

There are also times when external and internal perpetrators will collaborate to commit payment fraud for the company.

So far, according to MerchantSavvy.co.uk, there has been a total of $34.69 billion lost via payment fraud globally. This is higher than the loss in 2021, which was $33.59 billion! The year isn’t over, and already the record has been broken!

With these shocking statistics, online merchants have to be as vigilant as possible to fight payment fraud.

How to Fight Payment Fraud

One of the major issues that many online merchants have to deal with is dealing with “fake” customers. These will be persons who use fake email addresses and phone numbers to place orders.

As a result, you want to always check the validity of these credentials before you offer a product or service to a customer. You can use this HLR lookup to check the status of phone numbers.

Make sure you also implement strict KYC regulations for your customers. Make sure that you ask them to create an account before they can buy your products and services.

It’s also crucial to vet your internal team. You need to ensure that they don’t try to steal monies from your company by creating fraudulent transactions. One way to do this is to offer products and services directly to your internal staff.

This prevents them from buying your products and services on their own and allows you to keep track of transactions. Make sure you also conduct background checks on any new hires. You should also offer discounts to them, so they’re less likely to commit payment fraud.

Protect Against Payment Fraud

Now you understand some of the shocking statistics regarding payment fraud and how you can protect against it.

In 2022 so far, we’ve already seen more money lost via payment fraud than in the whole of 2021! At the current rate, one can expect at least $100 billion to get lost.

There are also instances where internal and external perpetrators collaborate to commit different types of fraud. Use the best practices mentioned in this guide to increase fraud prevention for your online business.

You can find more tips on business and security on our blog.