According to a recent Forrester report, E-commerce websites are estimated to lose a whopping $18.6bn this year because of fraud in the US and Western Europe.
The market analyst and compiled its figures from LexisNexis estimates that in 2017 the cost of fraud was just over 2% of revenue for e-tailers and that the regions are expected to generate $859bn in taxes this year.
After seen the result of the increasing losses, it claimed that the fraud management solutions market would increase the last year this is $5bn to reach $10.4bn by 2023; a CAGR of 12.9%.
The report claimed, however, the traditional enterprise solutions are more expensive — typically ranging from $750,000 to $1.2m, with implementation adding another 40-50% in costs — they can automate and change the accuracy of dangers scoring, reducing false positives.
This can, in turn, reduce the investment needed in fraud personnel to review transactions.
However, customer friction remains a crucial differentiator for effective modern fraud prevention platforms, argued Forrester.
The report claimed that technological advances such as AI would help to drive changes in the accuracy and effectiveness of solutions going forward.
It said that it’s time taking for fraud and danger management professionals to update about it fraud models continually, and it’s growingly hard to find the fraud across multiple channels such as cell-phones.
To fight with these risks, fraud management solution vendors are getting the help from some of the artificial intelligence tools, such as supervised and unsupervised machine learning into their products. It is also a significant concern to think for Blockchain as the next evolution in fraud management.
The report claimed that the Blockchain is a distributed and secure database. It is making it a trusted repository for device ID and known fraudster blacklists. Blockchain already secures payments and can be extended to enterprise fraud management.
Recently, the importance of fraud prevention was highlighted from PayPal’s $120m acquisition of Similarity, a pioneer in friction-free anti-fraud technology featuring machine learning.