Increasing use of convenient payment methods is driving up fraud losses for e-commerce merchants in 2023, according to the results of a new study.
In Online Payment Fraud: Market Forecasts, Emerging Threats & Segment Analysis 2022-2027 ($), U.K.-based consultancy Juniper Research estimates that e-commerce merchants globally will lose $48 billion in 2023, up 16 percent from $41 billion this year. North American merchants will account for 42 percent of the total value of e-commerce fraud losses around the world next year—the most of any region, according to the report. Western Europe will make up 26 percent of global fraud losses, Juniper predicts, followed by Asia at 22 percent.
While stolen data—obtained via breaches, phishing, social engineering or other nefarious methods—remains the biggest risk leading to e-commerce fraud, the report noted that the increasing popularity of alternative payment methods like digital wallets and Buy Now, Pay Later (BNPL) are giving bad actors new attack vectors that are pushing fraud to even higher levels.
“Given the delayed nature of BNPL payments, fraudsters can make several illegitimate payments using stolen card details before the fraudulent activity is identified, creating significant risk,” the report’s authors wrote. “In turn, the research recommends that BNPL vendors conduct robust identity verification at the point of onboarding to mitigate these risks.”
