Blog  /  Security  /  Guarding your business: the crucial benefits of anti-fraud solutions for merchants
Payop showcases its payment solutions at the Sigma Malta Conference

Guarding your business: the crucial benefits of anti-fraud solutions for merchants

Fraud has always been around, but with the rise of e-commerce, it has taken on an unprecedented scale. According to Statista, the e-commerce industry has lost 41 billion USD to online payment fraud in 2022. By comparison, that figure in 2021 was 21 billion USD. And without appropriate measures for online fraud prevention, the number will continue to grow at an alarming rate. Here is where anti-fraud comes into the picture.

What is anti-fraud?

Let’s start with the definition. Anti-fraud technology is a set of measures designed to keep your business safe from fraudulent activities. Their work ensures that only legitimate transactions are processed while rejecting malicious ones.

So, it’s important to choose PSPs that offer inbuilt anti-fraud features for your financial protection. These measures employ a combination of technological tools, data analysis, and human expertise to monitor and scrutinise all transactions, identifying any anomalies or suspicious patterns. Once detected, these systems employ real-time responses to prevent fraudulent transactions, safeguarding the business and its customers.

Common types of fraud

The goal of any fraud is the same – to steal money, but the approaches may vary. Depending on this, there are several main types of fraud:

  • Chargeback fraud – fraudsters make online purchases using stolen credit card details and then dispute the transaction, causing the merchant to lose both the goods and the payment.
  • By account takeover, cybercriminals gain access to customer accounts and use them to make unauthorised transactions.
  • Identity theft – fraudsters steal personal data to pose as customers and scam businesses in the process.
  • Payment fraud – thieves use stolen card details to make unauthorised purchases.

The latter two types of fraud are very similar. The difference is that in identity theft, criminals use personal information such as national insurance numbers or bank data to impersonate someone, while in payment fraud, they use card details.

Benefits of anti-fraud for your business

At first glance, antifraud may seem only necessary to prevent profit losses. In fact, its role is much more extensive and affects not only financial but also reputational, regulatory and other aspects:

  • Financial loss prevention: First things first, by promptly detecting and preventing fraudulent transactions, anti-fraud relieves you of the financial burden of refunds and chargebacks for unauthorised purchases.
  • Gaining customer trust in e-commerce: The second most important benefit of anti-fraud is customer retention. People are more likely to make a purchase if they feel secure about their data and money. Letting users know that you’re using anti-fraud can gain their trust and, more importantly, their long-term loyalty to your brand.
  • Compliance with standards: Anti-fraud solutions help businesses comply with industry regulations by demonstrating their commitment to data security and consumer protection.
  • Machine learning: Modern anti-fraud solutions utilize advanced technologies, including data analytics and machine learning. These tools help them adapt to evolving fraud tactics, making them increasingly effective in identifying and preventing new threats.

The conclusion is self-evident: Anti-fraud solutions are not just an option, they are a necessity in the world of e-commerce.

What does Payop offer?

Our company is a partner of the leading anti-fraud solution on the market. For merchants, it means they get built-in anti-fraud on our checkout free of charge. Unlike many PSP platforms, we don’t charge extra for this as we consider anti-fraud to be a necessity, not an option. So, our merchants get to enjoy all the benefits of having this security level.

Understanding open banking: A comprehensive guide
Stay up-to-date
Get our news earlier than others