Dealing with payment fraud takes up a majority of company expense and time according to a new survey from American Express. In its 2019 Digital Payments Survey, based on responses from consumers and 400 business leaders, 69 percent of U.S. merchants report that a significant amount of company time and expense is dedicated to dealing with payment fraud. Nearly eight-in-ten U.S. merchant respondents (77 percent) said their organization experienced some type of fraud during their time at the company, and their efforts to manage security are impacting their businesses’ bottom lines.
The amount of online sales lost to fraud is also on the upswing. Merchants surveyed estimate an average of 27 percent of their annual online sales to be fraudulent transactions, a significant increase from 18 percent in 2018. As a result, many merchants are investing more in payment data security, with survey respondents reporting that they spent an average of 33 percent of their IT budget this year on payment data security, up from 27 percent last year.
Consumers want convenience
While trying to balance it with security, merchants are also mindful of the needs of consumers who want ease and convenience when paying for purchases. The survey finds 85 percent report they have left items in their cart and not completed an online transaction.
In addition to online checkout, consumers also expect a seamless checkout experience in-store. Eighty-three percent of merchants noted that contactless provides a faster checkout option for in-person payments and is more convenient for customers than paying with card or cash. Consumers are picking up on contactless as well 26 percent saying they have used a contactless payment method at least once within the pas said x months.