Feedzai, the world’s leading risk management platform, has announced its Quarterly Financial Crime Report which contains financial crime indicators and consumer trends while drawing spending comparisons during one of the most complex shifts in consumer behavior. The report also identifies the top 3 Global Fraud Contributors in 2020 with card cloning, high-speed ordering/spending, and high-risk merchant category code taking the lead.
Fraudsters also seized opportunities provided by the shift to online transactions causing networks’ fraud rates to increase by 60%. Not only was there more fraud attempted, the dollar value of each attempted fraudulent transaction was 5.5% higher than it had been the six months preceding the pandemic.
The digital-first revolution brought on by the pandemic has shown that criminals – who already revealed technical sophistication – quickly adjusted to the new reality and that consumers adapted their shopping habits to the realities of lockdowns and social distancing requirements. In both cases, they’re not likely to switch back. In fact, 30% of consumers opened new accounts during the pandemic, and 75% of customers plan to maintain digital banking habits. A further 56% cited trust as the reason they opened new accounts with their current financial institution.
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30% Increase in Card Not Present (CNP) Transactions
- The radical shift to online commerce and banking produced a 30% rise in CNP transactions from April through August as compared to Q1 2020. As expected, the move away from in-person transactions realized a 22% drop in April for card-present (CP) transactions. However, and most surprisingly, by June, CP transactions, which dramatically decreased in April, recovered.
13% increase in sporting goods transactions comparing to holiday shopping levels
- With new social distancing guidelines and a dramatic change in people’s social behavior, which prohibited indoor gatherings, came with new shopping needs. One sector, in particular, has seen an uptick: sporting goods. Transactions skyrocketed during Q2 and Q3, reaching 2019 holiday shopping levels. Even more impressive, sales were sustained over three months. May 2020 saw a 13% increase in the number of transactions compared to the peak holiday month of December 2019.
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