Global Card Fraud Grows 20%. CNP Fraud Is On The Rise Worldwide

Jan 17, 2017

In 2015, total card fraud taken globally reached $21.84, which is almost 21% higher than the numbers registered in 2014. This is according to The Nilson Report, the most respected newsletter covering the payment systems industry. The US losses associated with global card fraud made up 39% or $8.45 billion; spending volume accounted for only 23%. Global losses are expected to grow through 2019, reaching $32.8 billion before the year 2020.

Given global spending volume accounted for over $31 trillion, fraud made up almost 7 cents per $100 spent in 2015, which is higher from 6.21 cents per $100 spent in 2014. Fraud accounted for nearly 12 cents per every $100 of volume in the US. Taken as a percent of volume, fraud is expected to reach 7.3 cents per every $100 spent in 2018. Then, it will account for 6.5 cents per every $100 spent in 2020.

According to the Nilson Report, losses can be classified based on issuers, and merchants and acquirers. Losses experienced by issuers made up 72% of global fraud loss, which was mainly the result of fraudulent debit and credit card transactions at the point of sale and ATMs. Losses experienced by merchants and acquirers made up 28% of global fraud loss and came mainly from eCommerce.

To open a safe and secure merchant account, consider turning to a reputable payment processing company like EMB is voted the #1 high risk payment processor in the US and boasts an A+ rating with the Better Business Bureau (BBB). With EMB, you can enjoy the best chargeback protection and prevention programs in the industry. EMB is rated A by Card Payment Options and is one of Inc 500’s Fastest Growing Companies of 2016.

Based on the Nilson Report analysis, fraud losses experienced by merchants and acquirers were mostly the result of card-not-present or CNP transactions. Unfortunately, the problem goes on growing. In 2015, losses to card-not-present fraud were more than $5.65 billion. The problem worsened in almost every country. In the US, fraud losses associated with card-not-present transactions already make up over 50% of total losses brought about by fraud.

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Having a merchant account allows an account holder to take advantage of merchant cash advances. When a merchant is approved for an advance, the business agrees to receive a lump sum of cash in exchange for an agreed-upon percentage of future credit card sales.

Pricing varies depending on the merchant’s industry, past credit card processing history, the type of business seeking the account, average ticket sales, and average transaction volumes.

Yes, EMB works with merchants who are building their credit, as well as those who have poor credit. EMB also approves merchants that have no credit card processing history and businesses that have lost their merchant accounts due to high chargebacks.

Several factors influence a merchant’s risk level. Though only one factor likely will not get a merchant classified as high risk, a combination of these may: business size, location, and industry, credit score, credit card processing history, a industry’s reputation for excessive chargebacks, a prior history of high chargeback ratios, and whether a merchant exclusively sells online.

Virtual terminals are stationed on a merchant’s website, making it easy for customers to make a payment or purchase online. Merchants or a payment processor can easily set up virtual terminals, so online businesses can accept credit and debit card and e-check transactions.

A merchant account is a business account with an acquiring bank. Without this business account, which actually works more like a line of credit, a merchant cannot accept and process credit and debit card transactions. Businesses need a merchant account to accept major credit cards via a static point-of-sale terminal, mobile card reader, or through a virtual payment gateway.

After filling out EMB’s simple online application and submitting any necessary, requested documents, many merchants get approved within 24 and 48 hours.

EMB specializes in working with high-risk merchants. EMB works with many merchants, including but not limited to businesses in these industries: gambling and gaming, adult entertainment, nutraceuticals, vaping and e-cigarettes, electronics, tech support, travel, high-end furniture, weight loss programs, calling cards, e-books and software, and telecommunications.

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