Fraud: The Causes, Impacts and Solutions

Fraud: The Causes, Impacts and Solutions

October 27, 2022 By: test Calculating time...

We’re inching closer to the busiest and mos awaited shopping days of the year. Usually, during this time, products go from being on the wishlist into the customer’s cart in no time. Is your small business ready for large orders? Bet you are! But are you also prepared to prevent any kind of fraud? And dispute chargebacks if need be? Let’s dig deeper.

Online shopping is a great way to beat the crowds and having multiple options to browse through from the comfort of one’s home is hard to beat. As business picks up heading into the holidays, fraudsters may have look to take advantage of the opportunity both online and instore.

So, as a small business how do you prepare for this? For starters, a few small changes to your business can have a meaningful impact.

  • Monitor your transactions regularly and keep an eye out for any suspicious behaviour like unusual amounts in quick succession.
  • Double-check any large purchases made by customers.
  • Use secure forms of payment and avoid taking card details over the phone or by mail and manually entering them as this offers no chargeback protection.
  • Be transparent about your return policies – keeping customers informed can reduce disputes.
  • Share your contact information with customers so they can easily reach out to resolve issues.

Moneris data shows being prepared throughout the year pays off when it comes to chargebacks as there is no ‘peak time’ for chargebacks.

  • In total, Moneris helped investigate over 300,000 chargeback cases in 2021, representing tens of millions of dollars in penalties and lost goods to small businesses.
  • Only 15% of those businesses tried to fight a chargeback.
  • Chargeback count decreased by 11% from 2021 to 2022.
  • The holidays are a busy time of year for retail businesses, some of which have seen a meaningful increase in average chargeback size year-over-year:
    -In department stores, chargeback size has more than doubled
    -Entertainment, chargeback size increased over 40%.
    -Specialty, chargeback size increased almost 50%.
    -Meanwhile, apparel is relatively unchanged.


Moneris data saw a rise in refunds heading into the holidays last year.

Pie chart

We offer solutions to prevent fraud and help support our merchants:

  • Authenticate transactions using a solution like 3D Secure 2.0, which shifts chargeback liability to the card issuer.
  • For eCommerce, use a secure online payment gateway like Moneris Checkout, which integrates with a variety of fraud prevention tools.
  • If offering delivery as a restaurant, UEAT could be a great tool to help with confirmation of delivery and order tracking.

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