Sadly, eCommerce fraud is on the rise.
Merchants are losing billions of dollars a year because of it.
Global eCommerce fraud losses are predicted to surpass $48 billion (USD) by the end of 2023.
For perspective, in 2022, losses accounted for $41 billion.
This article will address what you need to know about eCommerce fraud statistics as a consumer, a business, and as a marketer.
Post Contents
- 1 Key Statistics
- 2 Top eCommerce Fraud Statistics in 2024
- 2.1 1. It’s estimated that losses from eCommerce online payment fraud will reach $48 billion by 2023.
- 2.2 2. 84% of eCommerce merchants have experienced fraud attacks in the past 12 months.
- 2.3 3. The global online payment fraud losses are expected to reach $206 billion by 2025.
- 2.4 4. The global eCommerce fraud detection and prevention industry is expected to grow to $49.99 billion in 2023.
- 2.5 5. 47% of teenagers reported eCommerce fraud in 2020.
- 2.6 6. People in their seventies reported a median loss of $800 due to eCommerce fraud.
- 2.7 7. 43% of eCommerce customers have fallen victim to payment fraud.
- 2.8 8. Retailers in the eCommerce realm experience an average of 206,000 cyberattacks each month.
- 2.9 9. Global businesses are at risk of losing over $343 billion due to online payment fraud.
- 2.10 10. Friendly fraud is predicted to cost retailers $25 billion a year by 2023.
- 2.11 11. The shift to eCommerce during the pandemic resulted in an increase of 20% in online transaction values.
- 2.12 12. Germany and France have been hit the hardest by eCommerce fraud in Europe.
- 2.13 13. North America accounts for over 42% of all eCommerce fraud cases.
- 2.14 14. Latin America has experienced 20% of revenue losses due to fraud with 3.7% from eCommerce fraud.
- 2.15 15. More than 85% of Switzerland’s online merchants have reported being hit by fraudsters in 2021.
- 2.16 16. The United States is the most fraud-prone country in the world with 34% of its consumers being impacted.
- 2.17 17. 57% of all eCommerce fraud attacks targeted mobile devices in 2020.
- 2.18 18. Biometric authentication is expected to experience a 47% growth in the coming five years.
- 2.19 19. For every $100 chargeback, businesses lose $308.
- 2.20 20. Only 34% of global businesses are investing in eCommerce fraud protection solutions.
- 3 FAQs
- 4 Conclusion
Key Statistics
- It’s estimated that losses from eCommerce online payment fraud will reach $48 billion by the end of 2023.
- 84% of eCommerce merchants have experienced fraud attacks in the past 12 months.
- The global online payment fraud losses are expected to reach $206 billion by 2025.
- The global eCommerce fraud detection and prevention industry is expected to grow to $49.99 billion in 2023.
- 47% of teenagers reported eCommerce fraud in 2020.
- People in their seventies reported a median loss of $800 due to eCommerce fraud.
- 43% of eCommerce customers have fallen victim to payment fraud.
- Retailers in the eCommerce realm experience an average of 206,000 cyberattacks each month.
- Global businesses are at risk of losing over $343 billion due to online payment fraud.
- Friendly fraud is predicted to cost retailers $25 billion a year by 2023.
- The shift to eCommerce during the pandemic resulted in an increase of 20% in online transaction values.
- Friendly fraud is predicted to cost retailers $25 billion a year by 2023.
Top eCommerce Fraud Statistics in 2024
1. It’s estimated that losses from eCommerce online payment fraud will reach $48 billion by 2023.
By or before the end of 2023, it’s estimated that losses due to eCommerce online payment fraud will reach $48 billion (USD).
In 2022, that figure accounted for $41 billion.
Therefore, we can surmise that this fraudulent activity is on the rise and will cause an increase of at least $7 billion this year over last.
(Statista)
2. 84% of eCommerce merchants have experienced fraud attacks in the past 12 months.
Over the past year, 84% of eCommerce merchants have reported that they experienced fraud attacks.
This percentage is exceedingly high when you consider that 84 out of 100 merchants have seen an escalation in eCommerce fraud in the past year.
This is a scary statistic for merchants and consumers alike.
It confirms the haste at which we all need to implement countermeasures to prevent this problem.
(Zipdo)
3. The global online payment fraud losses are expected to reach $206 billion by 2025.
Globally, the overall online payment fraud losses are estimated to reach $206 billion (USD) by 2025.
In 2020, the global figure for online payment fraud losses accounted for $130 billion.
This shows us that the more advanced fraudsters are taking more money, and the instances are increasing as new payment technology is introduced to consumers.
It all relates to having more potential targets and more ways to gain access to confidential information.
(Stripe)
4. The global eCommerce fraud detection and prevention industry is expected to grow to $49.99 billion in 2023.
In terms of the global eCommerce fraud detection and prevention market, analysts expect this market to grow to $49.99 billion (USD) this year (2023).
A CAGR of 20.8% helped to calculate the rise from 2022 where the market was at $41.37 billion to the $49.99 billion (USD) for 2023.
Moreover, with a compound annual growth rate of 20.7%, this market is expected to grow to $106.08 billion by 2027.
(Global Newswire)
5. 47% of teenagers reported eCommerce fraud in 2020.
In 2020, statistics about eCommerce fraud revealed that younger people are at twice the risk of being scammed of all age groups.
Furthermore, 47% of teenagers reported fraud where they lost money in 2020.
Another 41% of people between 20 and 29 years old reported the same.
The median amount of money lost by people in their twenties accounted for $500.
(WebTribunal)
6. People in their seventies reported a median loss of $800 due to eCommerce fraud.
Studies show that people in their seventies lost a median amount of $800 due to eCommerce fraud in 2020.
For people over 80, their losses came to a median amount of $1500.
This shows that older people get scammed for more money than younger people.
(WebTribunal)
7. 43% of eCommerce customers have fallen victim to payment fraud.
Payment fraud accounts for a large amount of eCommerce fraud.
On the consumer side of the market, 43% of consumers reported falling victim to payment fraud.
Also, many consumers report that payment fraud is a recurring problem for them.
In fact, 62% of consumers who have fallen victim to payment fraud have been targeted between two and four times.
(Exploding Topics)
8. Retailers in the eCommerce realm experience an average of 206,000 cyberattacks each month.
In 2019, Signal revealed that eCommerce retailers experienced an average of 206,000 cyberattacks per month.
It’s highly likely that these attacks (attempted and successful) have increased since 2019.
Whether cyberattacks result in eCommerce fraud are successful or attempted but unsuccessful, it’s vital that we work together as consumers and retailers to continue to put the fraudsters out of business.
(FinancesOnline)
9. Global businesses are at risk of losing over $343 billion due to online payment fraud.
A 2022 Juniper Research report revealed that global businesses stand to lose over $343 billion due to online payment fraud between 2023 and 2027.
For perspective, this figure is more than 350% of Apple’s net 2021 net income.
This kind of data reminds us of the urgency of taking fast action against eCommerce fraud via preventative solutions.
(Stripe)
10. Friendly fraud is predicted to cost retailers $25 billion a year by 2023.
In terms of friendly fraud, retailers are expected to lose $25 billion each year by 2023.
For reference, friendly fraud is when a customer disputes legitimate credit card, debit card, or other payment method charges.
It’s also referred to as chargeback fraud.
Therefore, retailers need to be aware of how customers will take advantage of an already fraudulent-centric issue.
(Zipdo)
11. The shift to eCommerce during the pandemic resulted in an increase of 20% in online transaction values.
Due to the lockdowns in 2020 during the global pandemic, many physical stores were forced to close their doors.
As a result, a surge of online eCommerce activity took place.
In fact, the global pandemic came with a 20% increase in overall online transaction values.
This also resulted in more risks and challenges for eCommerce businesses as they experienced more security threats and online payment fraud activity.
(Stripe)
12. Germany and France have been hit the hardest by eCommerce fraud in Europe.
In terms of regional eCommerce fraud events, Europe faces a significant risk especially in France and Germany where it’s hit the hardest in the region.
This reveals that eCommerce fraud isn’t found in one region of the world or another.
It’s everywhere and it impacts the global population.
(Ekata)
13. North America accounts for over 42% of all eCommerce fraud cases.
The North American continent consists of 23 countries and some smaller island nations situated in the Caribbean Sea.
The borders are from the Artic Ocean to the Atlantic Ocean to the east, and Pacific Ocean to the west and south.
The 42% of eCommerce fraud cases have occurred in regions like Canada, the United States, Mexico, Central America, Greenland, Bermuda, and the Carribean islands.
(Ekata)
14. Latin America has experienced 20% of revenue losses due to fraud with 3.7% from eCommerce fraud.
Data shows that Latin America has experienced 20% i revenue losses due to fraud with 3.7% of that fraud being from eCommerce orders.
Latin America consists of regions of South America, Central America, Mexico, and the Carribean islands.
Some countries in Latin America include Mexico, Costa Rica, Panama, Jamaica, Guatemala, and Dominica.
(Ekata)
15. More than 85% of Switzerland’s online merchants have reported being hit by fraudsters in 2021.
In terms of global regions, 85% of Switzerland’s online merchants have reported being hit by fraud in 2021.
This is another example of how European countries are at risk for eCommerce fraud.
Additionally, two out of every three online merchants in Germany saw an increase in eCommerce fraud.
(Ekata)
16. The United States is the most fraud-prone country in the world with 34% of its consumers being impacted.
The United States is said to be the most fraud-prone country with 34% of its consumers reporting that they have fallen victim to fraud in general.
Therefore, it’s likely that this country’s consumers have experienced instance of eCommerce fraud more than consumers in other countries.
(Ekata)
17. 57% of all eCommerce fraud attacks targeted mobile devices in 2020.
While eCommerce fraud attacks are on the rise today, in 2020 57% of these attacks occurred on mobile devices.
You can imagine how much that has grown in three years.
These are the most recent statistics we could find until this data is updated.
We can assume that due to more mobile phone and smartphone usage has and will result in more eCommerce fraud attacks whether they are attempted or successful.
(Zipdo)
18. Biometric authentication is expected to experience a 47% growth in the coming five years.
Due to eCommerce fraud and other forms of fraud, it’s expected that there will be a 47% growth in biometric authentication usage over the next five years.
What is biometric authentication?
It’s one of the most popular ways to login to your phone and other devices, apps, and programs today.
It includes using fingerprints, facial recognition, or iris scans for identification to gain access to any device, program, app, or system.
(Stripe)
19. For every $100 chargeback, businesses lose $308.
According to data, for every $100 chargeback experienced by a business, it costs the business $308.
Why?
Because the burden of proof falls upon the retailer which means that the customer is always right, and the merchant is always wrong and must take the financial hit for it.
So, even when a retailer doesn’t do anything wrong, but a consumer decides they want their money back, the retailer loses money.
It happens more often than you might think, and it falls under friendly eCommerce fraud.
Many times, the customer also keeps the product.
(WebTribunal)
20. Only 34% of global businesses are investing in eCommerce fraud protection solutions.
Despite knowing the urgency and issues surrounding eCommerce fraud, only 34% of businesses are investing in fraud mitigation and prevention.
Considering the losses these businesses have experienced (some more than once or twice), you would think they would put more effort and invest heavily in security measures that fight eCommerce fraud.
(FinancesOnline)
FAQs
How Much is Lost to eCommerce Fraud?
At the global level, the losses due to eCommerce fraud are forecast to surpass $48 billion in 2023.
What are the Common Types of eCommerce Fraud?
It’s wise to know the most common forms of eCommerce fraud to protect yourself and to understand the urgency for protecting yourself.
Here are the most common types of eCommerce fraud:
1. ATO: Account Takeover accounts for 35% of all eCommerce fraud.
2. Friendly Fraud: Also known as chargeback fraud, friendly fraud accounts for 20% of all eCommerce fraud.
3. Payment fraud: This type of fraud accounts for 15% of all eCommerce fraud.
4. Refund Abuse: This is a form of eCommerce fraud that makes up 10% of all eCommerce fraud.
Keep in mind that this is a very short list of the different types of eCommerce fraud.
Make an effort to learn and understand them all using the sources we cited at the end of this article.
While some of these instances of eCommerce fraud can more easily be prevented, friendly fraud (chargeback fraud) is a complex issue for retailers.
Where is eCommerce the Worst?
While eCommerce fraud impacts the entire world, there are regions and nations that are more affected by this blight.
For instance, North America has the highest number of fraud transactions than anywhere else on the globe.
In fact, North America accounts for more than 42% of all eCommerce fraud events.
Europe also faces high eCommerce fraud risks. France and Germany have been impacted the worst.
What Contributes to eCommerce Fraud Increases?
Several factors are known to contribute to the world’s increases in eCommerce fraud.
Here are a few:
1. Growth in mobile shoppers
2. New payment methods being introduced and more on the horizon
3. Increasing sophistication of fraudsters
How Can You Protect Your Business Against eCommerce Fraud?
There are several things you can implement to protect your business from experiencing eCommerce fraud.
Here are the options we found:
1. Implement a fraud detection solution
2. Implement stronger authentication methods
3. Implement transaction monitoring to detect suspicious activities
4. Implement educational options for customers about eCommerce fraud and how they can protect themselves
More retailers should require at least 2FA or biometric authentication to ensure the safety and security of their customers.
In fact, offering multi-factor authentication may be tedious for consumers, but in the long run, safe for them.
How Can Consumers Protect Themselves Against eCommerce Fraud?
Here are some ways to protect yourself from eCommerce fraud as a consumer:
Merchants aren’t the only ones who need to protect themselves against eCommerce fraud.
Consumers need to know what they can do to protect themselves as well.
1. Shop only on trusted websites
2. Use Two-fact authorization (2FA) and strong passwords for all your online accounts.
3. Biometric authentication to access your mobile device and your apps.
4. Monitor your credit reports and bank statements to look for any suspicious activities.
5. Take caution when sharing information online and in what you share.
You can take time to do more homework on how to protect yourself from being a victim of eCommerce fraud.
Many apps and retailer apps today offer special authentication that includes 2FA and biometrics that are helpful for preventing some instances of fraud.
However, as consumers we must all be aware of the many methods fraudsters use like social media ads, text message tricks, and email spam to trick us into clicking on a link that gets our identity stolen or worse.
Conclusion
This article is intended to increase awareness of eCommerce fraud and how it affects everyone all over the globe.
Have you ever fallen victim to eCommerce fraud as a merchant or consumer? If so, you know that you’re not alone after reading the statistics.
After reading all these statistics, we should all want to do more to prevent and mitigate eCommerce fraud from the retailer and consumer side of the problem.
If we all do our part, we may be able to find better ways to prevent eCommerce fraud.
It would save retailers and other eCommerce businesses and consumers a lot of money and stress.
If you’re a retailer, what are you doing to prevent or mitigate eCommerce fraud for your business?
If you’re a consumer, what measures have you taken or are you taking to prevent falling victim to eCommerce fraud?
Hopefully, you feel more informed and enlightened about global and regional eCommerce fraud statistics after reading this article.
