E-commerce Fraud And Chargebacks – Statistics And Trends
Did you know that E-commerce industry suffered an estimated revenue loss of $6.7 billion due to chargebacks in 2016 out of which 71% ($4.8b) was due to friendly/chargeback fraud. Every dollar of fraud cost E-commerce merchants $2.40 in 2016, up from $2.23 in 2015. Check out our infographic on “E-commerce Fraud and Chargeback” for latest statistics and trends.
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Infographic by- Invesp Conversion Rate and Landing Page Optimization
Estimated average monthly value of Successful Fraud Transaction
Year Estimated Value 2013 $155 2014 $114 2015 $113 2016 $146
Top Chargeback Reasons
Reasons %age Fraud / No Authorization 57.9% Cancel Recurring Billing 18.6% Products / Services 18.3% Liability Shift 3.5% Others 1.7%
68% of online businesses were anticipating more fraud this year and 62% plan to invest more in fraud prevention
58% of cardholders do not contact the merchant at all – filing the dispute directly with the bank. Only 14% of cardholders contact merchants prior to charging back
40% of consumers who file a fraudulent chargeback will do it again within 60 days and 50% within 90 days.
Credit card chargebacks are rising at a rate of 20% per year, and friendly fraud rose 41% over the last two years
Top Challenges for Merchants to Quickly Distinguish and Confirm Fraud
Challenge %age Verification of customer identity 60% Delay in payment confirmation 43% Confirmation of package delivery 44% Address verification 45% Emergence of new and verified payment methods 26% Limited ability to reclaim merchandise 25% Assessment of fraud risk by country/region 11% Challenges in acceptance of international based payments 13% Lack of specialized fraud prevention 15% Excessive manual order reviews 14%
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