The cost of fraud for mid to large-size companies remains higher than for smaller companies. Every USD 1 of fraud results in USD 3.20 in fraud-related costs, compared with USD 2.32 for smaller businesses, which includes chargeback fees, merchandise replacement and labour costs for employees, the LexisNexis Fraud Multiplier added.
Credit card transactions remain the largest payment method for fraudulent transactions, while alternative online payments also contribute to rising successful fraud rates among ecommerce merchants.
LexisNexis Risk Solutions surveyed 200 risk and fraud executives in retail organizations that earn 80 percent or more of their revenue through online or mobile sales channels. The executives who responded cite cloud-base applications, digital subscriptions, mobile apps, downloadable software, online gaming and music streaming products as major contributors to higher levels of fraud.
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