According to an analysis by ACI Worldwide, friendly fraud is expected to rise by 25% between Thanksgiving and Cyber Monday.
Mitigating Friendly Fraud for Merchants
Erika Dietrich, VP Analytics & Optimisation Payments Intelligence at ACI Worldwide, highlights that the numbers reveal consumer purchasing trends. Over recent years, refund abuse and friendly fraud have significantly increased, fueled by simplified ecommerce and amplified through social media.
She notes that platforms now disseminate so-called refund hacks, normalizing misuse. This has a negative impact on merchants who bear operational and financial responsibility.
Despite traditional mitigation methods, these are often not sufficient to cope with the rapidly evolving digital landscape. ACI Worldwide aims to provide full journey protection through its Payments Intelligence approach, which halts friendly fraud and chargeback abuse in real time. The solution integrates technology with actionable insights to safeguard every transaction.
- Employing AI and machine learning for real-time detection and prevention;
- Leveraging digital identities and profiling to distinguish between trusted customers and potential threats;
- Facilitating secure data-sharing across merchant networks to identify malicious actors;
- Implementing policies against repeat abusers through declined checkouts or fees;
- Generating evidence against false claims by reviewing transaction histories and digital identities.
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