Each month, we’re sharing insights from Sift’s global data network on how COVID-19 is impacting e-commerce. The map illustrates monthly instances of fraud by region.
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*As calculated against 2019 averages.
The graph below shows how COVID-19 is impacting e-commerce merchants throughout the Sift global data network, which uses real-time machine learning to analyze 35 billion events per month—e.g., actions that Sift customers send to our network, such as login attempts, account creations, or transactions—to surface new fraud signals and trends.
The following data represents 7-day moving averages throughout the current month to illustrate how COVID-19 is impacting merchants by vertical. Note that in some cases, slowdowns in traffic are driving fraud rates higher because the average number of fraud attacks is being calculated against declining event volumes.
Overall traffic and transactions in digital e-commerce have risen significantly this month, while fraud rates are dropping. Total instances of fraud in this sector have dropped, too. It’s clear that, even seven months into lockdown, the economy is still very much in flux and fraudsters continue to exploit market unrest. Volumes will likely continue to fluctuate across digital e-commerce as the market reacts to loosened restrictions and significant economic changes in multiple verticals, with opportunistic fraudsters ready to take advantage of the uncertainty.
Volumes are way up in the ticketing and events space this month, with fraud rates trending downward. This surge in traffic and transactions is likely due to certain pandemic-related restrictions being lifted, though instability over the past several weeks is reflective of reinstated lockdown orders and widespread delays in plans to reopen the economy. Merchants should continue prioritizing secure experiences for their customers, and focus on safely navigating a restless market.
Though global travel bans quickly cleared the skies and the streets as coronavirus rapidly spread across the planet, volumes across this vertical have oscillated on a weekly basis. This month, traffic and transaction volumes are down, with fraud rates following suit. Consumers and merchants alike should stay vigilant, with fraud rates about 28% higher than they were last year at this same time.
This month in physical e-commerce, both volumes and fraud rates are trending downward. This could be due to pandemic-era restrictions being lifted and changed; some consumers have been returning to brick-and-mortar shops, while others continue to take advantage of no-contact shopping options. Despite consumers’ dedication to adapting to a post-COVID world, it’s clear that fraudsters have not slowed their efforts to exploit economic unrest. Merchants should continue to build flexibility and adaptability into their fraud mitigation efforts.
In the wake of coronavirus, online learning platforms have seen an avalanche of traffic as teachers and students turn to virtual classrooms and content. But this month, volumes are trending downward. Fraud rates in this vertical are up this month, and education shows the highest fraud rate across the entire Sift network—an unfortunate title it has held for the duration of COVID-19’s spread.
Both fraud and event volumes in the financial services space (e.g., banks, insurance providers, and credit unions) dropped again over the past month. The impact of businesses closing their doors or changing strategy over the course of the pandemic, coupled with far-reaching quarantine orders, has been immense. Some individuals and institutions are spending more conservatively and keeping a more watchful eye on finances, making this vertical an unattractive (though clearly not invisible) target for fraudsters.
Consumers have changed how they dine, where they eat, and how they pay. Social distancing requirements have led to a rise in mobile payments, food and grocery delivery, and BOPIS/BORIS (buy online, pickup/return in-store), initially causing significant increases in volume. This month, those volumes are up, although fraud rates are going down.
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