3 E-Commerce Trends In 2019 Increase Fraud Risk
Times change, trends change, and fraudsters are always searching for new opportunities to launch their actions by utilizing digital technology. Knowing the latest trends is very helpful for e-commerce to keep vigilant and be prepared in facing the increased potential fraud risks. The following are the three e-commerce trends 2019 which encourage increased fraud risk.
1. Cross-border e-commerce
The trend of cross-border e-commerce is expected to rise in 2019. The Asia Pacific is the region that is being called as the biggest e-commerce cross-border growth compared to the United States or the Middle East. The percentage of cross-border transactions in the Asia Pacific region in 2014 ranged 12 percent. However, it is expected to increase at 31 percent by 2020.
Cross-border e-commerce allows consumers and merchants in different countries to trade and open a transaction. However, different country profiles carry a tremendous potential risk of fraud.
2. Mobile on the rise
According to a result of research published by Statista, the number of smartphone users is expected to increase from 2.1 billion in 2016 to around 2.5 billion in 2019, with smartphone penetration rates also increased as well. More than 36 percent of the world’s population is projected to use smartphones in 2018, up from around 10 percent in 2011.
In line with Statista, based on predictions from 451 Research, a leading company in the field of IT research, the number of m-commerce transactions will take over global e-commerce transactions in 2019.
While a variety of instant payment mechanisms and P2P mobile money transfer services offer convenience and practicality to consumers, there are fraudsters lurking around searching for vulnerabilities to exploit from the relatively new and evolving mechanism of mobile transactions.
Omnichannel is a business model that uses cross channels – online and offline – to create convenience and ease of shopping for consumers. Research published by Market Research Future predicts that the global omnichannel retail market will grow from 2.99 billion dollars in 2017 to 11.01 billion dollars by 2023.
The driving factor of this trend is the increase of smartphones adoption. The adoption inevitably builds the awareness of the retail market about the significance of maintaining an online presence for the sake of consumers’ satisfaction. By adopting this business model, consumers more easily reach the brand/business wherever and whenever they want.
Even though it offers convenience and practicality for the consumers, the omnichannel opens up more potential fraud risks than the one channel model. The fraudsters can launch their complex modes at once through offline channels (fake checks, embezzlement, etc.) and online (for example, scam, phishing, malware, etc.) at the same time.