SAN FRANCISCO, March 15, 2022 (GLOBE NEWSWIRE) -- Sift, the leader in Digital Trust & Safety, today released its Q1 2022 Digital Trust & Safety Index, detailing the increasingly sophisticated—and often automated—tactics cybercriminals leverage to commit payment fraud. Derived from Sift’s global network of over 34,000 sites and apps and a survey of over 1,000 consumers, the index reveals that the payment fraud attack rate (the rate of fraudulent transactions blocked by Sift out of total transactions) across fintech ballooned 70% in 2021—making it the highest increase across any vertical in Sift’s network. The increase in payment fraud also correlated with massive 121% growth in fintech transaction volumes on Sift’s network year-over-year, making this sector an attractive target for cybercriminals.
According to Sift’s analysis, these rising attacks, blocked by Sift, were aimed primarily at alternative payments like digital wallets, which saw a 200% uptick in payment fraud, along with payments service providers (+169%), and cryptocurrency exchanges (+140%).
Sift has specifically seen these abuse tactics aimed at buy now/pay later (BNPL) services, which saw a 54% year-over-year uptick in fraud attack rates. In late 2021, Sift’s Trust and Safety Architects discovered a growing number of fraud schemes on Telegram offering unlimited access to BNPL accounts through fake credit card numbers and compromised email addresses—showcasing the array of methods actors in the Fraud Economy are using to target the entire fintech sector.
The Hidden Brand Impact of Payment Fraud
Along with network-wide growth in average daily transaction volumes across every industry, Sift saw an overall 23% surge in blocked payment fraud attacks in 2021. Concurrently, nearly half of survey respondents (49%) report that they’ve fallen victim to payment abuse over the past one to three years—and 41% of the victims experienced it in the last year alone. Of those victims, nearly one-third (33%) identified financial service sites as the ones that pose the highest risk, which could negatively affect customer trust in the industry.
“Many brands fail to realize that the damage of payment fraud goes beyond the initial financial impact,” said Jane Lee, Trust and Safety Architect at Sift. “The vast majority of consumers report abandoning brands after they experience fraud on a business’s website or app, diminishing customer lifetime value and driving up acquisition costs. Further, potential customers who see unauthorized charges from a particular company on their bank statements will forever associate that brand with fraud. In order to combat these attacks and grow revenue, businesses should look to adopt a Digital Trust & Safety strategy—one that focuses on preventing fraud while streamlining the experience for their customers.”
Tackling the Fraud Economy with Sift’s Fraud Intelligence Center
To help trust and safety teams better understand the intricacies of the Fraud Economy, Sift has launched its new Fraud Intelligence Center. Leveraging data from Sift's global network of 70 billion events per month, the Fraud Intelligence Center will provide trust and safety professionals with the latest data, trends, and expert analysis they need to fight back against the Fraud Economy.
Sift’s Fraud Intelligence Center can be found at sift.com/fraud-center and Sift’s Q1 Digital Trust & Safety Index can be found here.
About Sift
Sift is the leader in Digital Trust & Safety, empowering digital disruptors to Fortune 500 companies to unlock new revenue without risk. Sift dynamically prevents fraud and abuse through industry-leading technology and expertise, an unrivaled global data network of 70 billion events per month, and a commitment to long-term customer partnerships. Global brands such as Doordash, Twitter, and Blockchain.com rely on Sift to gain a competitive advantage in their markets. Visit us at sift.com, and follow us on LinkedIn.
Media Contact:
Victor White
Senior Director of Corporate Communications, Sift
press@sift.com
