Here’s how eCommerce sites use data-driven intelligence to combat fraud

Introduction

E-commerce fraud is a growing concern for businesses. Data from Juniper Research shows that the total cost of e-commerce fraud for merchants will surpass $48 billion globally this year, up $2 billion compared to last year. To reduce fraudulent payments, many e-commerce companies have invested in sophisticated data enrichment vendors to verify the authenticity of their users. This article explores how data intelligence tools help B2C companies and consumers purchase goods and products as securely and safely as possible.

First, what is a data intelligence or data enriching tool? 

Data enrichment or intelligence tools collect data from various sources, such as public records, social media, customer databases, and other online sources. The data is analysed to identify patterns, relationships, and additional insights that can be used to refine the accuracy and completeness of the data. Data intelligence tools use techniques such as text analysis, image analysis, sentiment analysis, and machine learning algorithms may be used to analyse the data. Once the data has been studied and enriched, it can be used for customer profiling, fraud detection, risk assessment, and marketing campaigns.

How can data enrichment tools help B2C companies to reduce fraudulent payments?

Data enrichment tools can help B2C companies to reduce fraudulent payments in several ways. Here are some examples:

• Identity Verification: Data enrichment tools can help companies to verify the biometric data of their customers using a range of data sources, such as credit bureau data, social media, and public records. By cross-referencing this information with the data provided by the customer during the checkout process, companies can ensure that the person making the payment is who they claim to be.
• Risk Assessment: Data intelligence tools can evaluate the risk of particular transactions based on multiple factors, such as the customer’s purchase history, location, and payment behaviour. By analysing this information, companies can identify potentially fraudulent transactions and take steps to prevent them.
• Fraud Detection: Data enrichment tools can be used to detect patterns and anomalies in payment data that may indicate fraudulent activity. For example, if a customer suddenly makes a large purchase outside their normal behaviour, this may be a vital red flag for fraudulent activity. Companies can quickly identify and prevent fraudulent activity by monitoring payment data in real time.
• Customer Profiling: Data enrichment tools can help companies to build more accurate profiles of their potential customers, including demographic information, purchase history, and behaviour patterns. By analysing this information, companies can identify potential fraud or suspicious activity and take steps to prevent it. Overall, by using data enrichment tools to verify customer identities, assess risk, detect fraud, and build more accurate customer profiles, B2C companies can reduce fraudulent payments and ensure the security of their payment processing systems.

Who are the top 10 payment methods for eCommerce? TAMI’s machine learning analysis of 500M websites

TAMI, a leading machine learning platform, recently analysed a staggering 500 million websites worldwide. The objective was to identify the most popular payment methods used by businesses across the globe.

Visa: With a staggering count of 2,604,102 websites, Visa emerges as the undisputed champion in online payment methods. Being a globally recognised and widely accepted credit card, it’s no surprise that Visa dominates the eCommerce landscape.

MasterCard: Securing the second spot, MasterCard boasts an impressive count of 2,366,629 websites. Known for its robust security features and wide acceptance, MasterCard remains a popular choice for online transactions.

AMEX: The American Express (AMEX) card occupies the third position, with a considerable count of 1,710,254 websites. Renowned for its prestigious brand image and exclusive rewards program, AMEX continues to attract discerning eCommerce customers.

Discover: With 930,969 websites accepting it as a payment method, and Discover captures the fourth spot. While its market share may be slightly lower than the top three, Discover’s reliability and customer-friendly features have earned it a significant following.

JCB: The Japan Credit Bureau (JCB) holds the fifth position, with an impressive count of 727,527 websites. Widely used in Asia and recognised globally, JCB offers customers a secure and convenient payment option for their online purchases.

Diners Club: Although its count is slightly lower at 475,718 websites, Diners Club remains a prominent player in the eCommerce payment landscape. Known for its exclusive benefits and global acceptance, Diners Club caters to a discerning customer base.

Bank / Wire Transfer: Bank transfers or wire transfers provide customers with a direct and secure payment method. TAMI’s analysis revealed that 465,027 websites offer this payment option, making it a popular choice for those who prefer traditional banking.

Maestro: Maestro, a widely recognised debit card brand, claims the eighth spot with 329,901 websites. Known for its ease of use and global acceptance, Maestro provides customers with a convenient payment option for their online purchases.

Pre-Authorised Debit: With a count of 282,026 websites, pre-authorised debit is a reliable payment method for recurring transactions. It allows customers to authorise merchants to debit funds directly from their bank accounts, making it suitable for subscription-based businesses.

ACH/Direct Debit: Closing our list of top payment methods, ACH/Direct Debit garners 233,657 websites. This method lets customers initiate payments directly from their bank accounts, providing a seamless and secure transaction experience.

In conclusion, TAMI’s machine learning analysis of 500 million websites has unveiled the top 10 payment methods for eCommerce. The dominance of credit card brands like Visa and MasterCard, along with the popularity of alternative methods like bank transfers, debit cards, and direct debits, highlights the diverse preferences of customers worldwide. By understanding these trends, businesses can optimise their payment options to align with customer preferences, enhance the shopping experience, and stay ahead in the competitive eCommerce landscape. As the industry evolves, staying updated with the most popular payment methods will remain essential for businesses to succeed in online transactions.