The development of alternative payment methods such as digital wallets and BNPL (Buy Now Pay Later), which introduce new fraud threats, could accelerate this growth.
In August, Unified Payments Interface (UPI) set a new record in India with 6.57 billion transactions totaling Rs 10.72 trillion.
UPI recorded over 30 billion transactions worth Rs 51.74 trillion in FY23 (till August).
Losses from the sale of physical items, digital goods, money transfer transactions, banking and other purchases such as flight tickets all count towards online payment fraud.
Phishing, hacking of business emails and socially engineered fraud are some examples of fraudsters’ attacks.
“To combat fraud, e-commerce merchants should implement simple steps such as address verification, combined with risk-based scoring of transactions, which will allow merchants to best mitigate the huge fraud threats,” suggested Nick Maynard, author of the research.
To better adapt to changing market conditions, the report advised fraud prevention vendors to focus on developing systems that offer AI-driven risk-based scoring and can thus be payment method agnostic.
The analysis also revealed that there is a significant possibility of fraud with BNPL in the future.
Due to the delayed nature of BNPL payments, there is a high chance that fraudsters will use the stolen card details to make many unauthorized payments before the fraudulent activity is discovered.