By the year 2025, approximately 70% of all online transactions will take place from a mobile device. This means that it’s more important than ever before to prioritize minimizing mCommerce fraud.
It all starts with understanding the most common types of mobile commerce fraud that you face as a business owner. Let’s explore them below.
This type of fraud occurs when a criminal is able to procure a user’s login information. With these credentials, they can then compromise the user’s account and operate online under their identity.
In this circumstance, the most common outcome is the criminal procuring the user’s financial information in order to make illicit purchases.
A popular method that criminals use during this scenario is the transfer of loyalty points. Since loyalty points are not recognized as a legitimate currency, activity regarding them is not as heavily enforced.
So, it’s entirely possible for someone to compromise a user’s account and transfer loyalty points to a dummy account before using the points for themselves.
As the name suggests, true fraud is the most conventional form of fraudulent activity. To elaborate, it involves a criminal making a purchase from a mobile device while using stolen financial information.
But, the criminal does need to input this information on their own device — using a stolen cell phone, iPad, etc. accomplishes the same task as long as the user’s financial info has been saved.
In the latter scenario, it can be exceedingly difficult for merchants to detect fraudulent activity. This is due to the fact that the criminal will make a purchase through a legitimate payment method from what the merchant perceives to be a familiar device.
Loyalty card fraud is another type of mobile fraud which involves fraudsters hacking into loyalty apps with the intention of stealing airline miles, gift card credit, or credit card credentials. Most often the goal of committing loyalty card fraud is somehow turn those stolen loyalty points (or gift card balances) into cash.
Fraudsters are taking advantage of the security gaps in these alternative payment methods to defraud companies. Loyalty apps often don't follow the same security measures that larger financial institutions use, so they've become an appealing target for fraudsters.
Implementing an end-to-end fraud protection solution can drastically help you manage these types of fraud. Vesta's transaction guarantee platform eliminates online fraud liability and chargeback fraud — significantly reducing the costs associated with bad transactions while increasing legitimate transactions (and revenue).
Fighting mobile commerce fraud doesn't have to be as cumbersome of a task as you might think. Consider the costs that mCommerce fraud could be inflicting on your business, and then consider the cost of a full fraud solution that can prevent fraud attacks and offer a 100% guarantee on all approved payments.
Want to learn more about what Vesta has to offer? Feel free to reach out to us today and see how we can help.