Ticketing, events, travel and transportation companies may see a double blow this year due to the Covid-19 pandemic. While most have already suffered from markedly lower transactions on their websites and applications, attempted fraud instances have largely remained stable for these verticals, so the fraud rates appear very high.
“This means that companies whose fraud rates get too high are subject to fines from payment providers, adding additional costs on top of already catastrophic losses,” said Sift, which reported the activity as observed by their Covid-19 and E-Commerce Fraud Tracker. The tool gives weekly insights into changes in e-commerce and fraud amid the coronavirus pandemic.
With most stay-at-home orders still firmly in force, Sift is also observing a sharp increase in online business activity across various platforms. The rate of attempted payment fraud (the percentage of fraudulent payments out of total transactions) has increased roughly 50 percent since early January, the company said.
There has also been a steady increase in activity across digital goods e-commerce sites through the beginning of 2020. Event volume (which includes things like account logins and account creations in addition to transactions) shot up 23 percent in this vertical starting in March, when many state and local governments implemented stay-at-home orders.
“Fraud rates have not caught up with the increased activity. However, Sift has seen a marked growth in total instances of fraud in that vertical,” the company noted in a statement.
Physical e-commerce, such as when a customer orders groceries online and picks them up in-store, has seen a 29 percent increase in event volume. Fraud rates in this vertical have also exploded 68 percent, which could possibly be due to fraudsters’ ability to hide more effectively within higher volumes, said Sift.