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E-Commerce Fraud Prevention: How Tech Can Help Protect Your Business
Chatty Garrate

Publisher : Chatty Garrate

E-Commerce Fraud Prevention: How Tech Can Help Protect Your Business

E-commerce has transformed the way people shop. Ecommerce (Electronic-Commerce) makes it easier for consumers to buy products and services from the comfort of their own homes.
However, as e-commerce has grown in popularity, fraud has become more prevalent, costing businesses billions of dollars yearly. Online shopping becomes more common among people, so does the chance for hackers and fraudsters to scam online businesses. If you run an online store, you know how important it is to take proper measures in order to protect your business. Hackers can steal important data or money from you, ruin your brand reputation online, misguide your consumers, harm your brand financially, and embezzle your earnings. Therefore, businesses must implement fraud prevention measures to protect their customers and their businesses.

This article will discuss how tech can help protect e-commerce businesses from fraud.

What Is Ecommerce Fraud?

Ecommerce fraud happens when someone intercepts a commercial transaction on an ecommerce store in order to gain a personal or financial advantage. It is criminal conduct in which scammers take money from the client, the business, or both. It's also known as payment fraud. These frauds can damage the business in several ways including:

* Financial losses
* Damage to reputation
* Operational disruptions
* Legal implications

With worldwide ecommerce sales skyrocketing, especially after the pandemic, fraudsters have created innovative opportunities and found new ways to steal customers' personal and financial data and perpetrate fraud.Ecommerce fraud is ever evolving and fraudsters come up with more advanced tactics each year.
Part of why there is the prevalence of ecommerce fraud today is that prosecutions are rare due to time and resource restrictions, lack of tech knowledge, and the costs of obtaining evidence. While it is important to incorporate a high-quality fraud detection and prevention management system to eradicate fraud on your platform; it is also important to get knowledge of modern tech such as artificial intelligence (AI) to leverage the right systems for your business.

Six Common Types Of Ecommerce Fraud :

* Credit card fraud
* Affiliate fraud
* Chargeback fraud
* Phishing/account takeover
* Interception fraud
* Triangulation fraud

Fraudulent activities can take many forms in e-commerce, including stolen credit card information, identity theft, and chargebacks. However, with technological advancements, e-commerce businesses can use various tech tools and software to identify and prevent fraud.

What is E-Commerce Fraud Prevention?

Ecommerce fraud prevention refers to the strategies employed to prevent, identify, and solve online fraud. Almost 90% of worldwide merchants believe fraud prevention strategies are crucial to their company strategy, not just for consumer safety but also to avoid loss.

What Are The Ways In Which Tech Can Help Your Business Against Ecommerce Fraud?

Fraud Prevention By Implementing A Tech Fraud Detection And Prevention System

Implementing a technical fraud detection and prevention system is one effective way to prevent fraud. These systems use machine learning algorithms to identify suspicious activity or analyze customers' behavior and transactions. For instance, if a consumer places an unusually big order or orders a high-value item with overnight shipping, the system can flag the transaction as possibly fraudulent. The system can also use data analysis to identify patterns and trends in fraudulent behavior, allowing organizations to adjust their fraud protection strategies accordingly.

Fraud Prevention By Creating Secure Ecommerce Websites :

Tech can also help protect your business from fraud when it comes to designing your ecommerce landing pages that provides a seamless and trustworthy shopping experience for their customers. Developers can create websites by using secure tech tools and software programs that not only keeps the corporate data safe but also takes care of customer data.

If you have been a target of ecommerce fraud, it is time to focus on your website security. To secure your ecommerce website, the best way is to first figure out why fraud is occurring and then use right tech support to develop strategies to avoid and protect against these attacks.

Fraud Prevention Using Two-Factor Authentication :

Another effective way technology can help protect e-commerce businesses from fraud is through two-factor authentication. When using two-factor authentication, customers require two kinds of identity: a password and a unique code delivered to their phone or email. Even if a hacker gets a customer's login credentials, they cannot access their account without the second form of identity.

Fraud Prevention Using Identity Verification Tools :

Using technical identity verification tools can help protect your business as these tools help identify customers' identities and ensure that they are who they claim to be. Various methods of using these tools verify customers' identities, including face recognition, document verification, and biometric authentication. For example, facial recognition technology can confirm a customer's identification by comparing their face to their government-issued ID.

Fraud Prevention Chargeback Prevention Tools :

Last but not the least, ecommerce businesses can use chargeback prevention tools to protect their businesses from fraudulent chargebacks. Chargeback prevention technologies can assist organizations in identifying and resolving potential chargeback disputes before they escalate to a chargeback. These tools can also help businesses combat fraudulent chargebacks by giving evidence to dispute the chargeback.

Tech can also help protect your business from fraud when it comes to designing your ecommerce landing pages that provides a seamless and trustworthy shopping experience for their customers.


In conclusion, e-commerce fraud can potentially destroy overall businesses and its customer base. But with technological advancements, e-commerce enterprises can utilize various tools and software to detect and prevent fraudulent actions. Implementing fraud detection and prevention systems, identity verification tools, two-factor authentication, and chargeback prevention technologies are useful methods for preventing fraud in e-commerce businesses. As e-commerce expands, businesses must be watchful and stay up to date on the newest fraud protection technologies to protect their consumers and make the business a success.