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2022 Credit Card Trends
3 Payments Trends For 2022
Written by Cyndie Martini
on September 27, 2022

Thieves keep getting more and more clever with their techniques of extracting value from merchants and consumers without exchanging money. We will look at three fraud trends that merchants and consumers should be aware of.

Friendly Fraud 

Cybersource.com says this is the number one fraud that many businesses are dealing with. That's up from number five in 2019. Friendly fraud occurs when a customer purchases something, receives the merchandise or service and decides to do a chargeback anyway. With credit card companies generally taking the customer's side, it can be difficult for merchants to win friendly fraud disputes.

Ways to potentially reduce friendly fraud include:

  • Customer notifications
  • Clarity of payment and return policies
  • Being very familiar with credit card processor chargeback policies
  • Verification measures to confirm customer identities

Some third-party credit card processor solutions can flag potential fraud as its takes place and prevent the charge from going through.

Synthetic Fraud

Synthetic fraud is a type of identity theft. Instead of stealing a person's identity, synthetic fraud meshes together bits and pieces of identity information to build a profile. To get a social security number, thieves generate a nine-digit number using fraudulent websites and then try them on a government site until a valid number is found.

Credit card repair companies use a similar technique by issuing CPNs or credit profile numbers. A CPN is basically a stolen social security number. Using CPNs is illegal (it's a federal crime to use a CPN). In fact, 18 people were convicted in Indiana for stealing social security numbers and sentenced to 40 months in jail.

Bot Attacks

Many merchant websites use CAPTCHA requests to thwart bots. However, bots keep getting smarter and, in some cases, can trick CAPTCHA requests. One way merchants can combat these increasingly smart bots is with the use of third-party AI (artificial intelligence) fraud detection services. Many of these services are cloud-based, making them more cost-efficient and easier to implement than a software installation-based provider.

 

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