E-commerce businesses and several other business segments stand to lose more than $200 billion to fraud in the next several years. Predictions from Juniper Research find e-commerce, along with airline ticketing, money transfer and banking services will cumulatively lose more than $200 billion to online payment fraud between 2020 and 2024.
Juniper’s report, Online Payment Fraud: Emerging Threats, Segment Analysis & Market Forecasts 2020-2024, finds the attack surface continues to grow along with desire among consumers to use digital payments. The research also reveals that digital money transfer is a growing area for payment fraud, and associated losses are forecasted to increase by 130 percent from 2020 to 2024.
“Digital money transfer fraud is particularly strong in emerging markets, with payments vulnerable to SIM swapping fraud and synthetic identities, with less robust security measures in place,” said Juniper in a statement. “The research therefore recommends that ongoing KYC (Know Your Customer) verification, including events-based re-verification following onboarding, are elements that are essential to secure the rising levels of digital transactions.”
Machine Learning Should be Part of the Fraud Fight
The report also finds that machine learning has become a crucial tool in the fraud detection and prevention arsenal. The incorporation of machine learning into fraud detection and prevention software will drive spending forward, reaching $10 billion in 2024, a 15 percent increase on 2020.
“The rapidly evolving nature of payment fraud and increased sophistication in attack methods requires machine learning adoption at scale, in order to minimize risk,” said research co-author Nick Maynard. “Constant innovation in analytics and data models is increasingly essential to constraining fraudulent behaviors in payments.”