Spending on online fraud detection solutions is expected to increase around 30 per cent over the next five years, as eCommerce merchants, financial institutions and marketers invest more heavily in an attempt to counter efforts by criminals and fraudsters.
According to Juniper Research, online fraud detection spending will hit $9.2bn (£6.5bn) by 2020 as fraudsters attempt to exploit the mobile payment channel, which is seen as particularly vulnerable (and therefore attractive), with many organisations yet to apply the same levels of protection to mobile transactions as those that apply to desktop eCommerce.
"Digital security companies regard the mitigation of mobile fraud as a key revenue generation in the medium term," said Gareth Owen, author of the research, who argued that this was driving the development and implementation of advanced authentication technologies such as biometric ID.
These tools are having an impact, with leading solution vendors able to now reduce fraud levels down to less than 0.1 per cent of transaction values in some key eCommerce verticals. The key challenge now is encouraging every industry to adopt the most stringent protections against fraud possible.
Juniper Research assessed 12 of the top fraud detection solution vendors as part of its study, and found that CyberSource, Experian and FICO all ranked top, with significantly higher performance than their peers in their data analytics capability and ability to monitor fraud across multiple channels.
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