For the second year, merchants reported rises across the board in different key measures that assess the extent to which fraud affects eCommerce.
The average statistics retailers reported rose internationally over the last year. These include higher income lost to fraud, more eCommerce orders being rejected as fraudulent and increased chargebacks and disputes.
North America recorded the most significant shift in fraud payment prevention spending. According to Atlas VPN, businesses upscaled their spending two times, from 5% of their annual revenue in 2021 to 10% in 2022.
Apart from North America, the Asia-Pacific (APAC) region also recorded a significant change from 2021 to 2022, where companies decreased their allocated part of the revenue for fraud prevention by 6%.
Earlier, businesses in the APAC area were spending the most of their earnings on payment fraud prevention, but after these changes, have come in line with the global average, which stands at 10% in 2022.
Mid-market companies allocate most funds for payment fraud prevention
Mid-sized businesses are now more likely to experience fraud than either small businesses or large corporations. On average, mid-sized companies spend 11% of their annual revenue on fraud prevention, while small businesses only spend 6%.
The reason for this is probably because mid-market businesses are big enough to be interesting targets for people who commit fraud, but they have smaller budgets and fewer employees, tools, and resources to use for protection against fraud. So mid-size companies may suffer more from eCommerce fraud than other companies.
Companies that earn $50 million per year also spend a lot of money for fraud prevention, with the global average being around 10%. This means that companies spend at least $5 million per year to fight against various types of purchasing fraud.
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