• E-commerce Fraud And Chargebacks – Statistics And Trends

    The state of ecommerce chargeback

    Editor Note: We highly recommend that you implement the different ideas in this blog post through AB testing. Use the guide to conduct AB testing and figure out which of these ideas in the article works for your website visitors and which don’t.  Download Invesp’s “The Essentials of Multivariate & AB Testing” now to start your testing program on the right foot.

    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.

    Ecommerce Fraud and Chargeback - Statistics and Trends

     

    Infographic by- Invesp Landing Page Optimization Company

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    Estimated average monthly value of Successful Fraud Transaction

    YearEstimated Value
    2013$155
    2014$114
    2015$113
    2016$146

     

    Top Chargeback Reasons

    Essentials of AB Testing
     Reasons%age
    Fraud / No Authorization57.9%
    Cancel Recurring Billing18.6%
    Products / Services18.3%
    Liability Shift3.5%
    Others1.7%

     

    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 identity60%
    Delay in payment confirmation43%
    Confirmation of package delivery44%
    Address verification45%
    Emergence of new and verified payment methods26%
    Limited ability to reclaim merchandise25%
    Assessment of fraud risk by country/region11%
    Challenges in acceptance of international based payments13%
    Lack of specialized fraud prevention15%
    Excessive manual order reviews14%

     

     

     

    Editor Note: We highly recommend that you implement the different ideas in this blog post through AB testing. Use the guide to conduct AB testing and figure out which of these ideas in the article works for your website visitors and which don’t.  Download Invesp’s “The Essentials of Multivariate & AB Testing” now to start your testing program on the right foot.

Ayat Shukairy

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