For many businesses, 2020 was the year when reinvention became the main lifeline. The world was going in and out of various lockdowns. Going for a walk or shopping at the corner supermarket became a lifeline. But the fear of COVID-19 contagion and the various restrictions imposed on the world pushed consumers to change their shopping habits. And their way of life.
A reduction in the use of cash and an increase in contactless payments. Increased online shopping, the number of retailers going online, and new eCommerce emerged during the pandemic to respond quickly to social circumstances and needs.
The result? A future that is coming much faster than anyone could have imagined. Fraud cases and the number of chargebacks have multiplied.
Let's see which ones have been the most common in recent years!
5 real cases of chargebacks and fraud during the pandemic
We have compiled some real examples to show you the problem in eCommerce, as well as an amazing way to reduce chargebacks and fraud:
- Phishing on fake marketplaces
This is what happened during the last Christmas holidays after a quick Google image search. "Andrew was looking for a pair of shoes from a well-known sports brand. After searching on Google Shopping and not finding the size and model, he switched to images. The search resulted in the third result being a website where the shoes were available."
- Email fraud
Early in the morning, a hotel employee received an email with a juicy reservation for "5 rooms and up to 10 people". This email was followed by several more seemingly trustworthy companies, but in the end, it was an attempt to commit fraud. Email is a frequent means for this type of scams, something like the usual scams but adapted to new information technologies. "A person located anywhere in the world has given us a modified email, and their goal is to make you believe the email is true. The next step is to install the malware. And the ultimate goal is generally financial." (INCIBE)
- Global cyberattack with techniques such as Magecart or web skimming
In seasons such as Black Friday, cybercriminals prepare to launch their attacks. In fact, eCommerce has experienced an increase in fraud in the last year that ends up compromising sensitive customer data. Magento, one of the most popular platforms for managing online stores, suffered a global cyberattack in September 2020 with techniques such as web skimming targeting online businesses created on this platform. The aim was to steal credit card data. (SecurityAffairs)
- DDos attacks on online platforms (Netflix or Spotify)
This was the computer attack that blocked access to Netflix, Spotify and Twitter in 2016. Several hackers launched an offensive against the US company Dyn, which stores and redirects the domains of these websites. They used a denial of service (DDos) attack to send a huge amount of data to the servers and render them unable to handle it. "Sending a huge amount of data means that a large number of devices connected to the network must act in a coordinated manner. In this case, the hackers used products manufactured by Chinese company Hangzhou Xiangmai Technology, which acknowledged that at least 500,000 of its devices were used in the attack." (The Guardian)
- Attack on Chinese giant Alibaba
We are dealing with one of the largest online sales centres in the world, with portals such as AliExpress, which receives millions of attacks every day. For this reason, the platform is investing more and more money in cybersecurity. "One of the most serious cases occurred a few years ago with a vulnerability that made it possible to find out the ID of a user connected to the platform with an automated script to track that mailing address." However, it was detected in time and the damage caused was minimised. (Fatima Martinez)
How to deal with chargebacks in eCommerce?
"Our knowledge of fraud is minimal; the financial department has little information and risk data is limited."
Can you relate to this statement? What can you do about it?
The key is to have a secure payment gateway and to control all transactions in your online store. To do this, you can use a dashboard to get an overview of payment transactions. The main advantages of having this system in online stores and managing the financial data in a good way are:
- A correct data interpretation and the functioning of our business.
- Improve results and stay ahead of the market.
- Keep track of transactions.
- Save time by having greater control with real-time data.
- Control the risk of chargebacks, refunds and fraud level in real time.
- Keep up to date with trends, interests and new shopping habits.
- Get a more organised and intuitive version of old and current data for comparison.
- View sales by currencies, websites, geography, and business models.
- Greater peace of mind by checking at a glance that everything is in order.
This will make it much easier for you to detect any faults or risks, and increase conversion while reducing chargebacks that affect the performance of your online business (double charges, goods not received, cancellations or returns).
Do you want to know more about eCommerce fraud, purchase returns, and pricing errors in online stores?