CMSPI issues data and strategy for European merchants facing fraud challenges

Friday 4 March 2022 09:40 CET | News

UK-based payments advisory CMSPI has estimated that European merchants spent nearly EUR 7 billion on fraud prevention in 2021 and have issued context and strategies to optimise the process.

These practices are unsustainable for the continent’s merchants, CMSPI notes, who are currently facing compound annual fraud growth of 1.5%. As retailers’ margins are shortened, fraud and its wider impacts are just another inflationary pressure that draw in losses for merchants and good customers. 

Throughout January 2022, CMSPI estimates that merchants saw over 600 million chargebacks from sales made during the holiday season. Alongside an increase in absolute volumes, the types of fraud merchants face are rapidly shifting too, with threats such as refund fraud coming to the forefront for omnichannel retailers: 

CMSPI officials explain in a press release that many merchants are caught between excessively strict fraud rules that turn legitimate customers away or boosting sales whilst making themselves vulnerable to attacks. These attacks damage not only their bottom line, but customer loyalty too. 

To tackle each threat, it is crucial for merchants to strike a balance between fraud losses, fraud prevention costs, and lost sales. This balance looks different for each merchant’s unique fraud mix, and finding it means utilising data-driven insights that often reveal inefficiencies a merchant (and their payments partners) didn’t expect, the advisory suggests. 

CMSPI is a data-powered consultancy advising clients on how to improve the productivity of their payments arrangements by reducing costs and increasing sales.

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Keywords: CMSPI, fraud detection, fraud prevention, ecommerce, chargebacks
Categories: Fraud & Financial Crime
Companies: CMSPI
Countries: Europe
This article is part of category

Fraud & Financial Crime


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