You’ve probably heard about ecommerce fraud in India! it’s relatively a big concern. But what exactly is ecommerce fraud? What can you do to avoid it?
In this blog, we will dive deep into the facts and figures to understand how bitterly it is damaging the ecommerce business experience for customers and businesses.
In today’s digital age, over 40% of daily routine purchases occur on digital marketplaces. And with this increasing popularity, the threat of getting targeted by cybercriminals is also evolving. If you are an ecommerce business owner, this blog is a must.
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What Is An Ecommerce Platform Fraud?
Frauds at eCommerce platforms occur by using false identities, fake payment cards, or unverified sources. These are mainly illegal payment transactions that fraudsters do on the website without the acknowledgement of the account owner.
To better understand the seriousness of this threat posed, you can go through the list given below:
- 60% of mid to large scale Indian retailers say that differentiating synthetic identities seems next to impossible.
- 80% of Indian digital businesses say ecommerce business fraud decelerates their efficiency and demotivates them from doing any innovation.
- 40% of frauds are committed by external perpetrators, 22% by internal, and 38% by external and internal colluding.
- 87% of Indian ecommerce businesses agreed that with fraud prevention programmes, they were able to reduce the potential fraud attacks
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Top 5 Common Ecommerce Platforms Fraud Types In India:
- Friendly Fraud
- Refund Fraud
- Account Takeover Fraud
- Interception Fraud
- Triangulation Fraud
Threat To Indian Ecommerce Industry
Ecommerce business fraud is currently on the rise in India, and with ecommerce expected to grow exponentially over the next few years, this issue will only get bigger. According to recent studies from several security vendors, the country is at a leading hand in ecommerce platforms frauds. The data reports that India is home to around 44% share of the global ecommerce business frauds at USD 1.26 billion against USD 2.63 billion globally, indicating an over USD 1000 million deficit.
But this does not mean that the Indian ecommerce industry is in the hands of fraudsters; even the authorities concerned have started taking strict measures against such identities and will continue with its consistent positive growth trajectory.
How Can The Threat Of Ecommerce Website Frauds Be Detected?
Rare prosecution is the most evident and noticeable reason for ecommerce website frauds occurring in India and globally. Thus, integrating a prime quality anti-fraud management system can minimize the losses and their harmful impacts.
- Multiple transactions in a quick period
- Large quantity of product purchases by the first-time buyers
- The contradiction between shipping and IP address
- Order from incomplete or weird location
Measures That Ecommerce Businesses Can Adapt At Their Level To Minimise Losses
You can incorporate information security methods to create robust security standards for your ecommerce business, for example:
- Address Verification Service or AVS
- Two-Factor Authentication
- Card Verification Value Codes or CVV
Prevention Of Ecommerce Platform Frauds Is Possible – You just need to take on the below actions
- Tightly Fence Your Ecommerce Business With Fraud Detection Solutions
- Maintain PCI Compliance
- Stay Extremely Vigilant (Especially During Holidays)
- Try Creating Blacklistings
Also Read: Mistakes That Can Stunt The Growth Of Your Ecommerce Business In 2022
Let’s Wrap Up
Fraud is a huge problem for online retailers everywhere. For instance, stolen credit cards and identity theft add up to lakhs and crores of the amount annually in India alone or about 3% of overall sales volume. This can have a significant impact on the bottom line, but ecommerce website fraud in India is exceptionally costly.
Due to the widespread prevalence of counterfeiting and fraud in general, a significant percentage of all transactions on multiple ecommerce platforms are estimated to be fraudulent. On top of this, 56% of counterfeit purchasers say they knowingly buy from online distributors who sell illegitimate goods.
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