CyberSource survey for UK reveals startling results about Internet fraud

[December 12th 2000]

58 percent of major online retailers in the UK consider online fraud to be a concern, yet 39 percent do not know who is financially liable when fraud takes place, according to an independent fraud survey commissioned by CyberSource Corporation.

Survey results revealed that although 62 percent of UK retailers estimate their online revenues will increase by 146 percent this holiday season (compared to the same period in 1999), 56 percent thought sales would increase even further if shoppers were not as concerned about fraud.

"The survey results indicated that fraud is a significant and limiting factor in online retailing," said Neil Cook, Managing Director of CyberSource's UK operations. "The fact that many retailers didn't know they are financially liable for fraudulent online purchases is alarming and shows that online retailers, as well as the public, are inadequately informed about the repercussions of credit card fraud on the Internet."

Approximately half of the survey respondents declared that they already utilize an automated fraud prevention solution. Of those who do not, 43 percent stated that between 40 and 100 percent of their orders are manually checked. As the volume of transactions increases for these businesses selling online, an advanced, automated solution, like the CyberSource Internet Fraud Screen, will be critical to successfully reducing fraudulent transactions. The fraud survey also found that "insult rate," related to inaccurate fraud detection, owing for example to poor customer service time and exception processing, is the number one negative impact on business for online retailers, followed by loss of goods, loss of revenue, bank fees and chargebacks.

The fraud survey was conducted by Euromonitor Consultancy on behalf of CyberSource, and represents the opinions of respondents from senior management, business management and information technology departments of mostly large UK "high street" retailers and a small proportion of small- to medium-sized businesses.

Links
CyberSource		http://www.cybersource.com