As e-commerce volume soars during the holiday season, so does the risk of fraud. Between Thanksgiving Day and Cyber Monday, the Monday after Thanksgiving, 18% of e-commerce transactions originating in the United States were identified as potentially fraudulent, according to a report from TransUnion LLC. On a global basis, 15% of e-commerce transactions were considered potentially fraudulent.
TransUnion analyzed same-store e-commerce sales from more than 40,000 Web sites and apps contained in its TruValidate fraud-detection solution.
As part of its analysis, TransUnion found that the risk of fraud for U.S. e-commerce transactions is 127% greater between Thanksgiving and Cyber Monday than it was from Jan. 1 thru Nov. 23, the day before Thanksgiving. Globally, the risk of fraud on an e-commerce transaction during the same period was 82% higher than it was from New Year’s Day thru Nov. 23.
Promotion abuse and account takeover were the leading fraud-attempt types, according to TransUnion.
Black Friday, the day after Thanksgiving, was the day when online fraud was most likely to occur, with 26% of online transactions flagged for fraud, followed by Cyber Monday, with 24% of online transactions identified as potentially fraudulent. Fraud was least likely to occur on Thanksgiving Day, with 12% of online transactions being potentially fraudulent.
“Despite the fact that consumers have begun returning in larger numbers to in-person shopping in the post-pandemic era, online retail continues to be the preferred means of holiday-shopping for many. It’s important that online retailers ensure consumer security and privacy protections, which is important to consumers, but in a way which ensures a seamless shopping experience that minimizes unnecessary friction,” said Shai Cohen, senior vice president and head of global fraud solutions for TransUnion, in a prepared statement.
Becoming a victim of fraud is a leading concern for consumers shopping online, with 54% of U.S. consumers expressing such worries, a 17% increase from a year ago, according to TransUnion’s 2022 Consumer Holiday Shopping Survey, which was conducted in August.
In related news, BigCommerce Pty Ltd., an e-commerce platform provider for business-to-consumer and business-to-business merchants, reported merchants in its network saw a 32% increase in gross merchandise value (GMV) from Thanksgiving through Cyber Monday, compared to the same period a year earlier.
Sales on mobile devices for BigCommerce merchants accounted for 38% of total orders during Cyber Monday and the days immediately following it, that is, Cyber Week, compared to 42% a year ago. Sales on tablets were just 1% of total sales, during the same period, compared to 1.3% for the same period in 2021.
Buy now, pay later remains a popular payment option, with BigCommerce merchants seeing a 25% increase in purchases financed by BNPL loans during Cyber Week, compared to a year earlier.