Online retail card fraud drops during Black Friday weekend
Online retailers — and consumers — have something new to be thankful for this holiday season: a decrease in online fraud.
For the first time in recent years, credit card fraud — which remains the highest fraud type for online retailers — has dropped to 42% of total fraud during the holiday weekend (Nov. 24 – 27, 2017). This level was 59% of total fraud for the same period in 2016, according to data from device intelligence for authentication and fraud prevention provider Iovation.
Overall, this decrease demonstrates that online retailers are making strides in their ability to identify and prevent card-not-present (CNP) fraud which has been on the rise since brick-and-mortar retailers have increased their adoption of EMV card technologies, the study reported.
Consumers are doing more of their holiday shopping online in general, a practice that has contributed to a decline in transactions occurring solely on Black Friday and Cyber Monday. This is the result of a shift in sales strategies among online retailers that are now extending promotional deals beyond the holiday shopping weekend.
According to data, 62% of consumer’s online retail transactions from Black Friday to Cyber Monday originated from mobile phones/tablets, compared to 55% last year, confirming the trend that m-commerce during the holidays is increasing year-over-year.
“Online retailers who leverage device intelligence are making significant inroads when it comes to proactively preventing card-not-present fraud,” said Greg Pierson, CEO and co-founder for iovation. “This type of fraud not only cuts into their bottom line results, it can cause irreparable harm to their brand so this is a meaningful improvement.”
In a separate survey of more than 1,000 consumers across four generations, 83% percent of respondents seem to understand how to protect themselves online. They are using a credit card rather than a debit card for online purchases, monitoring credit scores regularly and shopping at well-known retailers. Yet, consumers across all demographic groups continue to exercise poor password hygiene.
While currently serving as consumers’ primary means of authentication, passwords frequently fail when it comes to both user experience and security. Despite these shortcomings, vulnerable passwords are firmly ensconced in today’s online experience.
Of those surveyed, 60% of consumers said they are not changing their passwords regularly (less than every six-to-12 months). Worse, close to 70% use the same password across multiple sites, meaning that a hacker can easily take over multiple consumer accounts with just a single compromised credential, the study said.
A shift from static, password-based authentication to frictionless, multi-factor authentication is crucial to combat today’s escalating threat environment. Multi-factor authentication combines the best of user experience and heightened security for businesses.
Using context to determine how trustworthy the user is ensures the appropriate level of authentication is required. Thus, dynamic authentication makes the right things easy and the wrong things more difficult, providing additional or less layers of authentication when needed, the study said.
No comments found