Online SMEs fear fraud spike during pandemic

Over half of online businesses (55 per cent) are now fearful of an increased risk in fraudulent payment transactions following the pandemic, according to payments platform Paysafe.

The international research among online SMBs found the same concern about payments is prevalent among consumers, with 60 per cent of online firms saying customers are “more concerned” about being a fraud victim amid the pandemic – 76 per cent have “noticed a change” in the way their customers are making payments.

When asked why, the highest number of respondents (40 per cent) said consumers are “looking for a more secure payment method”. But 58 per cent said they “find it hard” to strike a balance between improving security processes and making the online customer journey “as quick and easy as possible”.

1,100 small- to medium-sized businesses (SMBs) across the US, the UK, Canada, Bulgaria, Italy, Austria and Germany were questioned for the research.

Danny Chazonoff, chief operating officer at Paysafe, said: “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.”

Paysafe research among 8,000 consumers internationally conducted in April this year, highlighted that protection against loss from fraud (34 per cent) and keeping financial data safe from fraudsters (32 per cent) were the two main reasons for consumers choosing a payment method.

Over half of consumers (51 per cent) said they would “accept any security measure” if it kept their data secure, “however poor it made the user experience”.

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