Adyen Finds One-Third of Businesses are Victims of Fraud

“There’s no single solution to fraud defence, as a strategy will need to be tailored based on the business model and platforms used to make sales. With technology in place, such as machine learning tools, retailers should be able to recognise genuine customers and spot fraudulent activity across their sales channels.”

He adds: “Machine learning can help to analyse global data sets and therefore keep on top of new fraudulent activity, ensuring the business is protected in real-time. We use advanced technology combined with customisable risk rules to protect retailers and their customers – blocking fraud, preventing disputes and staying ahead of the latest fraud trends.”

Businesses ‘must respond’ to growing threats of fraud

The risk of fraud has impacted consumer shopping behaviour both in-store and online. Adyen notes that 26% of consumers now feel more unsafe when shopping today compared to 10 years ago, due to the increased risk of payment fraud.

As a result, 16% of consumers actively choose to shop at stores with higher security measures. Likewise, when shopping online, 23% of consumers like it when retailers ask them to verify their identity in at least two different ways before making a purchase.

However, despite such an increase in fraudulent activity, Adyen’s research highlights that only two-thirds of businesses (63%) currently have effective fraud prevention systems in place. This is an increase of 10 percentage points since last year (53%).

In response, they are now exploring new ways to respond to growing fraud threats to better protect themselves and their customers. In fact, Adyen notes that more than half (47%) have actively considered changing their payments provider to one that can offer improved fraud defence mechanisms.

Additionally, 46% have started considering how their business can be compliant with Payment Services Directive 3 (PSD3) – an EU directive setting out stricter rules for protecting consumers’ rights and personal information in the finance industry.

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