Tag: mobile fraud

E-commerce fraud could be put to rest with the new service from Zomigo

Zumigo, a leading developer of device location and identity verification technology, has announced that it will be launching a new service that could help in the fight against e-commerce fraud. The company suggests that the service will be the first of its kind, having the ability to validate merchant payments using real-time location data from a consumer’s mobile device. Such a service could go a long way in improving the security of the e-commerce field, as well as make mobile payments more attractive to merchants.

Merchants continue to combat fraud in the digital world

Conventional payment processors can confirm payments with little issue. These processors do not protect merchants from fraudulent charges, however, especially when they come in the form of charge-backs made at a later date. In the event of fraud, merchants have typically already shipped products to their buyer. If the purchase was fraudulent, then the merchant must find some way to recover the cost of the lost product, as well as the shipping costs associated with the purchase.

New service uses real-time mobile data to verify user identity

The new service from Zumigo aims to provide a solution for this problem. The service is designed to verify a consumer’s identity through the use of mobile billing records, which are obtained through Zumigo’s partnership with Equifax. The service matches credit card information with the mobile data that is available in an attempt to confirm that the consumer is who they say they are. In the event of fraud, merchants will have the ability to pursue legal action and recover their losses because of the information that will be made available to them.

Service may help bolster faith in mobile commerce

This service could be a boon for the mobile commerce field, wherein fraud has become a serious problem. Merchants have shown interest in embracing mobile commerce, but they are wary because of the high prevalence of fraud in this sector. Zumigo believes that its new service could spur some growth in the mobile commerce field by making it safer for merchants o participate therein.

Merchants are losing an average of $334 for every $100 of fraudulently made purchases on their sites.

According to the results of the recent True Cost of Fraudsm Mobile study, which is held annually by the Reed Elsevier from LexisNexis Risk Solutions, mobile commerce is facing a very expensive problem through fraud.

Merchants have been increasing to m-commerce on a steady basis and fraudsters are seeing this as an opportunity.

According to the study results, revenue from mobile commerce that is lost as a result of fraud has increased by 70 percent, last year. It rose to 1.36 percent in 2014 after having been 0.80 percent in 2013. Comparatively, among all merchants, 2014 saw an increase that brought the total lost revenue from fraud to 0.68 percent, after having been 0.51 percent in 2013.

There are a number of different avenues for fraud in m-commerce, due to the complexity of the broader range of payment channels, such as online payments programs and digital wallet apps. This in combination with added access channels such as native apps, shopping comparison apps, and mobile websites can considerably increase the risk of fraud.

The research has revealed that the average number of payment channels offered by mobile commerce merchants is 4.5.

This is notably greater than the average number of payment types accepted by online or in-store merchants, which is 2.6. This higher number of acceptable types of payments has placed those companies at a notably higher level of fraud exposure.

Twenty one percent of all fraudulent charges that were recorded were linked to mobile commerce. This is upsetting as the number of transactions that are actually occurring over smartphones continues to be a small percentage of the total sales for merchants. Last year, 14 percent of all of online transactions occurred over mobile channels.

According to the LexisNexis Risk Solutions vice president of corporate markets, Dennis Becker, “Mobile commerce is going to be more widely adopted by merchants because customers are clamoring for the convenience. To reduce customer friction and sell more through the mobile channel, now is the time for mCommerce retailers to put in place fraud prevention tools to counter the disproportionate amount of fraud that is currently occurring.”