APAC E-Commerce Surges During Pandemic, Fraud Spikes Too

Ecommerce is probably the only sector that has seen growth amid the COVID-19 pandemic. We’re shopping for everything from groceries to clothes and appliances online. It’s not just millennials that are shopping online, even those who have never used a debit card to shop before are experimenting with online shopping.

Salesforce Shopping Index suggests that digital e-com revenues saw a surge and 20% growth globally in the first quarter of 2020. In the APAC region, the rise of eCommerce has been highest in China. 55% of the Chinese population plans to make purchases online.

The study also showed that 49% of Indians, 34% of the Japanese and 30% of Australians plan to make more purchases through eCommerce. Unfortunately, this rise in eCommerce popularity is also being accompanied by a rise in online fraud. There’s been a marked increase in phishing activities and identity fraud. Attempted fraud rates have grown by 3.8% since the previous year.

A Shift In Consumer Trends

Where people earlier shopped mainly for clothes and fashion online, they are now shopping for daily necessities like groceries as well as making high-value purchases like jewellery online. This trend is likely to continue to grow in light of the convenience and added safety offered by eCommerce. As consumer behavior shifts, fraudsters are also likely to continue to target unsuspecting merchants and consumers.

Fighting Online Fraud to Retain Customers

If people were hesitant before about shopping online, the risk of fraud was one of their main concerns. Thus, it is the merchant’s responsibility to protect them from fraud while simultaneously offering improved customer experience. For example, they must verify orders being placed and simultaneously ensure that they are delivered within the shortest timeframe to the correct address. Here are a few tips that could help.

• Maintain Clean Databases

Fraudsters often create fake accounts to gain entry to a business’s database. To do this, they may use fake email addresses and phone numbers or use someone else’s personal details. To reduce the risk of this happening, all onboarding should go through a verification service. The person’s identity as well as their phone number and email address provided should be verified for authenticity and validity. It should also be checked against the database to identify duplicate accounts.

• Monitor Systems and Keep Them Updated

It’s not enough to only screen accounts when they are being onboarded. The database and systems should be constantly monitored and updated to reflect the latest inputs from fraud intelligence. For example, when fraud intelligence identifies a fraudster, the risk should be communicated to your system in real-time. If he/she has an account in your system, it must instantly be highlighted to allow you to take appropriate measures.

• Give Your Security Team the Tools Needed to Address Issues

To protect customers, businesses must give their mobile and web security management teams the tools and a clear operating procedure to detect and deal with botnets. You need to take a proactive approach to such threats and define procedures before being attacked to empower them to take decisions quickly.

• Maintain Up-To-Date Customer Profiles

Maintaining accurate customer profiles serves a dual purpose- it helps authenticate accounts and reduces the risk of fraud while simultaneously providing data to help personalize and improve the customer’s shopping experience. For example, consider the shopper’s preferred mode of shopping. If a customer usually places his/her orders through the website and opts for payment on delivery, an order placed through the app and paid for online may be highlighted as a deviance from regular activity. In such cases, the company may choose to verify the order with the customer through two-factor verification or any other such system before confirming the same.

Tips for Customers to Protect their Identity

Customers must share the responsibility of protecting themselves when shopping online. Here are a few tips to do so.

• Never Give Out Personal Information

Customers must always be wary of emails, phone calls and online requests that ask for personal information. Any email that asks for information like your phone number or full name is likely to be part of a phishing scam. Another way to identify potential phishing emails is to look out for emails with generic greetings. Almost all companies personalize their marketing campaign to address the individual by his/her name. Also, avoid acting on emails or responding to tele callers who insist on an instant response. Many fraudsters attempt to create a sense of urgency to fool their targets.

• Take A Closer Look At Email Addresses

Fraudsters often use email addresses that seem very similar to the authentic email addresses. For example, a fraudster trying to imitate a Paypal may use an email address such as ‘paypal@notice-access.com’ instead of an email address ending with @paypal. Or, they may send out an email from an email address ending with @payypal or @payppal. They may also send an email from a public email domain. For example, not even Google will send emails from an address that ends with ‘@gmail.com’.

• Avoid Clicking Links On Emails

Many emails have links that promise to take you directly to a business website. This is something many fraudsters take advantage of. Thus, it is always better to type out the website address on the address bar instead of clicking the link in an email. Alternatively, you can try to check the destination of the link before clicking on it by hovering over the URL. In some cases, the legitimacy of the link becomes apparent with this simple step.

In Conclusion

Though security agencies are constantly at work designing ways of securing data and protecting customers, fraudsters work just as quickly to find ways around existing security measures. Thus, neither can the customer nor the business afford to be complacent at any point in time. Businesses that fail to do so will lose their customer’s loyalty and put themselves at risk of fines. Simultaneously, customers must be careful when shopping online and do so only at trusted websites.