In this article, I will share some of the surprising stats about this eCommerce industry. These statistics would be related to eCommerce scams. I can assure you that these aren’t just mind-blowing but frightening at the same time. I’ll be sharing the key stats on eCommerce fraud that no one discusses.
Let’s have a look at the key stats below.
- According to a report by Digital Fraud, eCommerce fraud is estimated to cost merchants $40.62 billion in losses by 2027.
- As per a report by Merchant Savvy, global payment fraud has almost tripled in the last few years. It rose from $9.84 billion to $32.39 billion in 9 years.
- 54% of the users have experienced online frauds and suspicious activities on the internet.
- According to a Juniper Research report, eCommerce fraud will likely surpass $20 billion in 2021 due to fraudulent and shady activities.
- A report from Digital Fraud states that fraudulent average order purchases increased by 69%, as the internet traffic surged by 60%. .
These are the most important as well as surprising statistics about the eCommerce industry. You have already dug deep into this topic. Let’s read in detail about these statistics. Follow the given heading to take a look at these stats in detail.
On This Page
- 1 11 Surprising eCommerce Fraud Statistics
- 1.1 The eCommerce Fraud is Estimated to Cost Merchants $40.62 Billion in Losses by 2027.
- 1.2 Global Payment Fraud has Tripled in the Last Few Years. The Fraud Rose From $9.84 Billion to $32.39 Billion in 9 Years.
- 1.3 54% Of the Users Experienced Online Fraudulent and Suspicious Activity on the Internet.
- 1.4 eCommerce Fraud Will Likely Surpass $20 Billion in 2021 Due to Fraudulent and Suspicious Activities.
- 1.5 Fraudulent Purchases Increased by 69%, As the Internet Traffic Surged By 60%.
- 1.6 5,305 People Faced in the United States in Just a Gap of Three Months Counting from March 2019 to June 2019.
- 1.7 eCommerce Frauds Increased by 45% in 2017. The Entire eCommerce Industry Made a Loss of $57.8 billion.
- 1.8 Credit Chargeback Fraud is Rising 20% Each Year. In addition, Friendly Fraud Rose 41% in the Last Two Years.
- 1.9 Only 14% of the People Contact the Merchant Regarding the Charging Back Issue. While 58% of People Directly Contact the Bank.
- 1.10 In 2016, the eCommerce Industry Lost Over $6.7 Billion in Revenue Because of Chargebacks.
- 1.11 Every Dollar Stolen From eCommerce Merchants or Store Owners Cost Them $3.36 in 2020.
- 2 Sources
11 Surprising eCommerce Fraud Statistics
Have a look at the mentioned statistics in detail. There you go!
The eCommerce Fraud is Estimated to Cost Merchants $40.62 Billion in Losses by 2027.
(Source: Statista, Merchant Savvy)
According to Statista, 59.5% of the total population has access to internet connectivity. In addition, 92.6% (4.32 billion) of this population access the internet from their smartphone devices.
These numbers are growing rapidly as technology has made them accessible to all. Users are using the internet to perform multiple tasks, including online shopping.
As the numbers are rising, the fraudulent activities are also increasing. According to a report by Merchant Savvy, global frauds are growing at a higher rate and costing too much to the eCommerce merchants. The losses are expected to cross $40.62 billion by 2027, which is 25% higher than 2020.
Global Payment Fraud has Tripled in the Last Few Years. The Fraud Rose From $9.84 Billion to $32.39 Billion in 9 Years.
(Source: Merchant Savvy)
As stated earlier, internet users are increasing immensely with time. More and more users want to experience a seamless one-click online shopping experience. You would be shocked to know that global payment frauds have tripled in the last few years.
In 2011, the losses were $9.84 billion. Then, in 2020, it reached $32.39 billion. It is expected to increase by 25% by 2027 as compared to 2020.
According to the Merchant Savvy report, these losses are incurred by cardholders, card issuers, eStore owners, and more. Additionally, the transactions are processed via Visa, Mastercard, UnionPay, AmericanExpress, Diners, Discover, and JCP.
Image Source: Merchantsavvy.co.uk
54% Of the Users Experienced Online Fraudulent and Suspicious Activity on the Internet.
(Source: SPD Group)
According to a report by Chuprina, 54% of internet users have experienced online fraud. It means half of the internet population has gone through this experience. Online fraud has become the most common way to steal money amongst all.
If not from online fraud, 18% received scam mobile spam calls, and 13% experienced fraudulent door-to-door sales. While some others faced this via post mail (12%) and offline stores (5%).
Image Source: Financesonline.com
According to the repose and surveys, users said that businesses should be aware of the risk in their business and online system. In addition, they should know the tools to prevent their business from these risks.
eCommerce Fraud Will Likely Surpass $20 Billion in 2021 Due to Fraudulent and Suspicious Activities.
(Source: Juniper)
According to a Juniper Research report, eCommerce fraud is likely to cross $20 billion in 2021 because of fraudulent and suspicious activities. In 2020, the number was relatively modest, around $17.5 billion. After comparing both years’ data, we can see that the losses increased by 2.5 billion in 2021.
It has surged by 18% in a single year as compared to the previous year. China is expected to be the largest player in this eCommerce fraud market. It is accountable for over 40% of eCommerce fraud losses globally in 2025. The losses are expected to be around $12 billion.
As per the report, the fraudsters targeted consumers as they started using eCommerce websites to order products. They discovered loopholes in this system and used them for their profit. The report also states that eCommerce merchants were totally unaware of these activities. They don’t know how to tackle all these things.
Fraudulent Purchases Increased by 69%, As the Internet Traffic Surged By 60%.
(Source: Digital Fraud)
According to the report by Digital Fraud, fraudulent purchases increased by 69% year over year. The reason behind this is the rise in the number of users with internet access.
The research states that internet traffic surged about 60% in the past few years. As a result, the purchasing capacity of users has increased; they spent almost doubled compared to earlier.
This eCommerce fraud industry is scaling at a higher level and affecting the lives of people. As per Digital Fraud, In 2020, every industry experienced a shift in demand, and fraudsters used these vulnerabilities for their own purpose.
5,305 People Faced in the United States in Just a Gap of Three Months Counting from March 2019 to June 2019.
(Source: econsumer.gov)
The United States is one of the most affected countries of fraudulent and suspicious activities. In three months, from June 2019 to March 2019, the US reported over 5,305 cases related to online fraud.
It means 5,305 people faced online scams in the United States in three months, counting from June to March 2019. Besides, in 2017, 40 million US citizens were affected by online scams and crimes.
In the United States, the most common activity known to do fraud is selling weight loss products and accessories. The greed of losing weight in a short span costs people a huge loss. In 2017, scammers registered over 10 million purchases.
eCommerce Frauds Increased by 45% in 2017. The Entire eCommerce Industry Made a Loss of $57.8 billion.
(Source: PYMNTs)
In 2017, the eCommerce industry incurred a loss of $57.8 billion. According to the PYMNTs report, it increased by 45% in 2017. As per the sources, eight big industries were drastically affected due to this.
In Q2 2017, the fraud increased by 5.5%, as compared to Q2 2016. In Q2 2017, orders exceeding the $500 amount had a total fraud rate of 11.64%, 22 times higher than orders less than $100. Orders less than $100 had a real fraud rate of 0.52%.
Consumer electronics, cosmetics and perfumes, jewelry, and precious metals were the most affected industries in 2017 due to online scams and shady activities.
Credit Chargeback Fraud is Rising 20% Each Year. In addition, Friendly Fraud Rose 41% in the Last Two Years.
(Sources: Quick Sprout)
Credit chargeback is one of the most common ways to steal someone’s money. In this method, the payer raises some questions and forces the bank to reverse the funds at any condition. As a result, eCommerce merchants make huge losses.
According to the given source, credit card chargeback fraud is rising 20% each year. Besides, the other most common online scam after this is the friendly chargeback. This fraud rose 41% in the last two years.
According to the statistics, 40% of the payers who file the chargeback request make the request again after two months. Then 50% of those users file a request again in the next three months to get a chargeback. Yet, most people file credit card chargeback requests within a week.
Only 14% of the People Contact the Merchant Regarding the Charging Back Issue. While 58% of People Directly Contact the Bank.
(Source: Invesp.com)
According to Invesp, Only 14% of credit cardholders contact eCommerce merchants for the chargeback issue. While 58% don’t reach the merchant, they directly contact their bank. They file a dispute with the bank regarding the chargeback issue.
As mentioned above, credit chargeback fraud is rising immensely by 20% each year. Merchants find different reasons behind the credit card chargeback. Some request a chargeback when they don’t like the product, or some ask to cancel the recurring billing. Yet, online fraud is the most common amongst all.
In 2016, the eCommerce Industry Lost Over $6.7 Billion in Revenue Because of Chargebacks.
(Source: Invesp)
According to Invesp, in 2016, the eCommerce industry encountered a revenue loss of $6.7 billion due to credit card chargebacks. This amount includes the service fees, taxes, revenue, and merchandise losses.
Out of $6.7 billion, $4.8 billion was lost due to credit card and friendly chargeback. Again, the store owners state different reasons behind the credit card chargeback.
As per Invesp, 68% of online businesses are facing more fraud this year. The best part is, 62% of the total are planning to invest in fraud prevention methods.
Every Dollar Stolen From eCommerce Merchants or Store Owners Cost Them $3.36 in 2020.
(Source: LexisNexis, 2020)
In 2019, the United States lost over $1 billion in eCommerce fraud alone. The cost per dollar is also increasing with time and at a continuous rate. According to LexisNexis, the per dollar cost was $2.40 in 2016. Then, it rose to $3.13 in 2019. As of 2020, it costs US retailers $3.36 for every dollar they lost due to fraud.
Sources
Digital Fraud (Page 4)
