Exploring the latest payments and fraud trends at MRC Vegas 2022

Friday 18 February 2022 07:18 CET | Editor: Anda Kania | Interview

Tracy Kobeda Brown, VP of Programs and Technology, MRC: ‘The unprecedented rise in first-party misuse in the last year has frustrated merchants as they grapple with the ROI of challenging certain chargebacks versus accepting certain fines.’

The MRC publishes a comprehensive annual report on ecommerce payments and fraud trends. Looking at the 2022 edition, what are some trends that have had the most substantial impact on the industry? 

Our Payment and Fraud Benchmarking Survey, produced in partnership with Cybersource and Verifi, is always a reliable industry benchmark for fraud and payments KPIs. This year is no exception. I highly recommend getting the report for specific data and insights, but there were a few general highlights that stood out.

Because we are still in an economic climate influenced by COVID-19 and rapidly changing business and buying models, fraud costs and associated KPIs increased for a second consecutive year. 

In the coming year, the top priority for merchants appears to be reducing fraud and chargebacks over improving the customer experience, along with minimizing fraud-related operational costs. This is likely in direct response to the increase in fraud and first-party misuse from last year. 

Could you elaborate more on the profile of the respondents to the survey, with regards to their company size, geographic location, and experience in the industry? 

For this year’s survey, we had 1,060 merchant respondents who are involved in ecommerce payment and fraud management within their organizations.   

The sample includes countries within four geographic regions: North America, Europe, APAC and LATAM. Respondents are split into three organization sizes: small to medium-size business (USD 50k to < USD 5 M USD), mid-market (USD 5M USD to < $50M USB) and enterprises (USD50M+) from four industry verticals.

What trends did you encounter regarding first-party misuse vs. legitimate chargebacks in 2022? 

We don’t expect first-party misuse to go away or return to pre-COVID numbers any time soon. The increase in this specific type of fraud over the past year has demonstrated the need for examining processes to separate first-party misuse from legitimate chargebacks. There’s a great deal of data on this topic in the survey that we will be exploring in-depth at MRC Vegas 2022; it continues to be an incredibly important topic for our members and the entire ecommerce industry.

Some losses are expected as a cost of doing ecommerce, similar to shrinkage in physical retail. However, the unprecedented rise in first-party misuse in the last year has frustrated merchants as they grapple with the ROI of challenging certain chargebacks versus accepting certain fines.  

In talking with our members, we realized that there are tangible improvements to categorizing these fraud uses appropriately. This led to the MRC holding a day-long virtual event on the challenges associated with first-party misuse that attendees found very productive. We plan to continue this focus on bringing together key stakeholders from across the industry, including issuers and regulators, to find a path forward on first-party misuse.   

What should merchants and ecommerce professionals know about account takeover (ATO) in 2022? 

According to our surveys over the years, ATO is consistently in the top ten of fraud issues globally, and that continued to be the case in 2021.

An example of this came up recently, when we heard anecdotally from law enforcement that the number of European compromised credit card numbers for sale on the dark web had decreased significantly in the last few years. This is likely because criminals are moving to easier targets – systems in other regions that have not implemented sufficiently strong authentication controls.

Merchants and ecommerce professionals should recognize that improved payment and fraud controls in one area of the world can shift fraud volumes in their systems as criminals continue to use the attacks that work across the merchant base.

This is where organizations like the MRC add value. Directly connecting with others who may have adopted a particular payment method or fraud prevention strategy can potentially save merchants’ resources as they learn what has or hasn’t worked with those implementations.

Do you see any disruptive payments trends emerging that are likely to significantly impact the ecommerce industry in the near future? 

There have been some notable trends that accelerated in the last year, likely due to the continued impact of COVID-19 on business models. More merchants are implementing or evaluating third-party payments like cryptocurrency as information becomes available from early adopters.    

While third-party payments are trending up, Buy Now, Pay Later (BNPL) choices are continuing to appear in more checkout processes. BNPL options are an increasingly desirable choice for customers who may shun traditional credit cards. 

Finally, there’s more of an emphasis on digital wallets and mobile commerce as merchants continue to respond to changing customer buying patterns.   

It’s likely fraud trends will respond to these alternative payment methods with increased identity and account takeovers. It will be interesting to watch the regulatory landscape of payment methods that carry a different risk profile not backed by traditional industry and financial safeguards. 

Regarding the upcoming MRC Vegas 2022 event, what are some of the presentations you’re most excited about?

It’s difficult to choose! MRC Vegas 2022 (7-10 March) features a huge variety of presentations from some of the brightest minds in payments and fraud prevention, and I’m not just saying that because I’ll be presenting. This year’s speaker lineup is one of our best yet.

I’m excited for our deep dive into the data contained in the Payments and Fraud Survey we’ve been discussing here. I truly believe understanding the metrics and KPIs in the report will add substantial value to anyone implementing new payment methods or stepping up their fraud mitigation strategies. Even if you can’t attend the session in Vegas, I highly recommend getting your copy of the complimentary report.

As someone excited by the impact of new technologies in our industry, I’m looking forward to the presentations on cryptocurrency, machine learning, tokenization, the latest in fraud prevention strategies, and the other technology-focused solutions being explored. 

I’m also looking forward to the popular Women in Payments and Fraud Luncheon, and of course, catching up with colleagues in person.

I hope to see everyone there!

About Tracy Kobeda Brown

Tracy Kobeda Brown is the VP of Programs and Technology for the MRC. She was head of product for Fragomen, Lockerz, and the CEO of Evil Genius Designs. Tracy created the American Eagle Outfitters website,, and served as CISO. She earned her Masters from Carnegie Mellon and her Bachelors in Economics from The Wharton School.  

About Merchant Risk Council 

The MRC is a global community connecting ecommerce fraud prevention and payments professionals through educational programs, online community groups, conferences, and networking events. As a non-profit organization, the MRC is headquartered in Seattle, Washington, but embraces members from across the globe.

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Keywords: fraud prevention, ecommerce, first-party misuse, chargebacks, report
Categories: Fraud & Financial Crime
Countries: United States
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Fraud & Financial Crime

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