The ease and convenience of gift cards means they can be bought and delivered without ever needing to set foot in a store. However, the convenience, ease of use and flexibility of gift cards is also what makes them popular with digital fraudsters. Despite their earning potential, merchants need to be alert to these risks.
One key reason friendly fraud is such a problem is that merchants and banks lack the capacity to distinguish between legitimate and illegitimate dispute claims. AI-based tools sending transaction data would allow for more accurate analysis of industry trends and consumer preferences, freeing up resources and reducing overhead.
As COVID-19 continues to impact the market, we’ve seen a massive shift toward ecommerce. The rise in contactless payment as a result of the coronavirus has been a key trend. Consumers are adopting options like mobile ordering and in-store pickup at an astonishing rate. Learn about best practices to address fraud risks.
It’s near impossible to keep up with the pace of change in ecommerce payment. That’s a problem, because fast-paced innovation inevitably leads to vulnerabilities. Without the right approach, revolutionary profit opportunities could fall victim to advanced ecommerce payment fraud threats. A multilayered, strategy is needed.
The gulf between industry policy and the practical realities of the market creates vulnerabilities and opens the door for new threats like friendly fraud and cyber shoplifting. Visa and Mastercard are stepping up to take this challenge seriously. But is it enough? What’s really needed is a consistent process across card brands.