Online fraud has been increasing in numbers and continues to double as more credit cards produce. In the US alone, online fraud is expected to knock at $19 billion by 2018, 55% higher than that recorded last 2005 (Javelin Strategy & Research, Pleasanton, California). In the next 12 months, online fraud will be expected to increase by more than 51%.
These fraudsters move their operations online by stealing products to stores then moving to e-commerce. People who engage themselves to online fraud buy card numbers to hackers and then use these card numbers to purchase products online.
Smaller companies have the bigger vulnerability to experience online theft; however, companies who mainly operate online must also be well-informed on how to determine if the transaction will be a fraud or not.
There are technologies that can help companies to identify fraud by analyzing factors involved in a transaction. These issues must be considered before proceeding to any online transactions:
1. If the shipping and billing addresses do not match;
2. If the order is placed on an unknown device;
3. If the e-mail address associated with is unfamiliar.
In addition, “The Impact of Fraud and Chargeback Management on Operations, conducted by Javelin, suggests that outsourcing fraud prevention services can also help online businesses deal with online fraud.
“This study makes it clear: fraud costs are eating into many merchants’ budgets, reducing the amount of money that could be spent on activities that grow and improve the company,” said Al Pascual, director of fraud and security at Javelin. “Unfortunately, if merchants don’t take action now, those costs will continue to rise as merchants attempt to mitigate the growth of online and mobile fraud.”
Online fraud continues to operate discreetly and is inevitable as more companies and businesses are engaging more on online marketing.