Retailers are set to lose some $130 billion in digital CNP (Card-not-Present) fraud between 2018 and 2023, according to latest figure Juniper Research.
The new study highlighted that increasingly complex approaches by fraudsters, alongside retailers’ intertia in adapting to new fraud prevention requirements, would be key factors behind the increases in fraud transaction value.
The new research, Online Payment Fraud: Emerging Threats, Segment Analysis & Market Forecasts 2018-2023, claimed that as cybercriminals seek to monetise their knowledge to a wider, less tech-savvy audience, complex cross channel fraud will become the ‘new normal’, with retailers ill-prepared to fight it.
Changes in Perception Required
Established POS vendors such as Verifone and Ingenico will therefore increasingly look to mPOS as an area for future growth, expanding their market reach to previously unaddressed markets.
“A layered FDP solution naturally helps directly preventing fraud, but it also offers major gains in terms of recovering potentially lost revenue through false positives. This is something about which retailers remain undereducated, and has allowed fraudsters to capitalise on relatively low FDP spend,” explained research author Steffen Sorrell.
Fraud Detection Growth
Juniper found that the perception of FDP return on investment on the part of retailers is, in turn, hampering global FDP spend growth. Juniper anticipates that digital payment players will spend $9.6 billion annually on FDP solutions in 2023, although the bulk of growth over the forecast period is likely to be driven by financial institutions and payment service providers. This is due to awareness of FDP benefits, as well as a requirement to deal with challenges such as open banking systems and instant payment mechanisms.
Barbra Nasimiyu, Nairobi