As digital wallets gain popularity especially for e-commerce activities in Singapore, they are increasingly becoming a target for cybercriminals.
According to The True Cost of Fraud APAC study by LexisNexis Risk Solutions, mobile apps are the largest source of fraud costs, with some e-commerce businesses reporting a 10% increase in fraudulent mobile transactions. Third-party synthetic identity and friendly first-party fraud made up a sizeable proportion of fraud losses.
Some of the top challenges local e-commerce firms face when it comes to fraud detection include lack of identity information about payment service providers’ customers (69%), high volume of transactions (61%), and difficulty in determining transaction location (52%).
Moreover, only a quarter of the respondents have integrated cybersecurity into their fraud prevention processes.
Since every US$1 lost to fraud now costs Singaporean organisations US$3.91, organisations that do not have the right capabilities to detect and combat fraud have much to lose as mobile wallet fraud is expected to be on the rise.
“We are seeing a high volume of fraud attempts that follow a continued shift towards mobile and digital transactions. Businesses must fully integrate a fraud detection and prevention programme with both physical and digital identity attributes while enhancing digital customer experience to stay ahead,” says Thanh Tai, director of fraud and identity strategy at LexisNexis Risk Solutions.
