Increased risk of fraudulent payment transactions has been one of the biggest concerns of online retailers this year, according to new research from payments platform Paysafe.
In the survey, which asked 1100 small and medium-sized businesses (SMBs) with an online presence about the effect of COVID-19 on their operations, 60% of online retailers said they feel consumers are more worried than ever about becoming a victim of fraud as a result of the crisis. More than three-quarters (76%) had noticed their customers had changed the way they are making payments, with 40% citing searching for a more secure payment as the reason for this.
In addition, Paysafe found that security remained the primary payment concern among SMBs for the third year running. Nearly half (45%) of respondents said it was in the top three most important factors to consider when evaluating a payments provider, ranking higher than reliability (36%), cost (34%) and ease of integration (22%).
Despite this, the majority (58%) admitted they had faced difficulties in achieving the right balance between improving security processes and creating a quick and simple customer journey. However, there appears to be a greater tolerance among consumers for more stringent security to be put in place, with Paysafe highlighting its research from April in which 51% of consumers said they would accept any security measure if it kept their data secure, however poor it made the user experience.
Danny Chazonoff, chief operating officer at Paysafe, commented: “Protecting ourselves from fraud has long been reported as a concern among businesses and consumers, but our research shows that security has become more of a priority than ever, and there are a few reasons for this. The economic impact of COVID-19 has led to a natural desire from both consumers and businesses to protect their finances. Coupled with that, we know that criminal activity such as fraud historically rises during national and global crises, and this pandemic has been no exception.”
There has been a huge shift to digital shopping during the pandemic, with many consumers forced to purchase items online for the first time due to lockdown restrictions. This has opened up new opportunities for fraudsters, particularly exploiting those unused to using the internet. For instance, the charity Age UK found that elderly people in the UK were scammed out of £2.4m in the period from March 23 to July 31 this year.