Q1 2026 DIGITAL TRUST INDEX

The State of Payment Fraud and Account Takeover

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The State of
Digital Fraud

Digital commerce continues to expand rapidly, creating new opportunities for businesses while increasing the attack surface available to fraudsters. As more financial activity moves online, organizations must manage risk across a broader set of customer interactions, payment methods, and digital services. Across the Sift Global Data Network, digital transaction volume increased significantly in 2025, reflecting continued growth in e-commerce, subscription platforms, and digital marketplaces. At the same time, fraud pressure shifted throughout the year. Attempted account takeover (ATO) attacks surged early before declining later, while payment fraud attack rates remained comparatively stable despite rising transaction activity.

These patterns highlight an important shift in how fraud operates across the digital economy. Increasingly, fraud originates earlier in the customer lifecycle, often beginning with compromised credentials or unauthorized account access. Once attackers gain control of accounts, they exploit stored payment methods, redeem loyalty balances, and place fraudulent transactions that appear legitimate because they originate from trusted users. Consumer experiences reinforce this trend: a meaningful share of users report encountering both account takeover and payment fraud, illustrating how attacks frequently move across multiple stages of the digital customer journey.

The financial scale of fraud also continues to expand alongside digital commerce. Global e-commerce fraud losses are projected to exceed $107 billion annually by 2029, increasing at an estimated 19% compound annual growth rate. For many organizations, the true cost of fraud extends far beyond individual fraudulent transactions. When operational costs such as investigations, dispute management, customer support, and fraud prevention tooling are included, fraud and related abuse can consume nearly 10% of annual online revenue.

CHAPTER 1

Digital Commerce Growth and Fraud Exposure

Expanding opportunities for businesses are raising the stakes for fraud prevention. Growing transaction volumes and account activity require systems that can assess risk at scale, minimize unnecessary friction, and deliver a premium experience for high-value customers.

Data from the Sift Global Data Network shows a clear rise in digital activity in 2025. Total transaction volume increased 18% compared to 2024, with activity climbing nearly 14% from Q1 to Q4 alone. The expansion of digital ecosystems means organizations are handling more interactions across payments, accounts, and devices. While this growth supports legitimate commerce, it also broadens the potential attack surface available to fraudsters.

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The Acceleration of Digital Commerce

+18%

Transaction growth across the Sift Global Data Network (2025 vs. 2024)

+14%

Transaction growth across the Sift Global Data Network (Q4 vs. Q1 2025)

Account Takeover Trends

Account takeover is one of the most damaging forms of fraud, though it’s often overlooked. By gaining access to legitimate user accounts, attackers can bypass traditional fraud detection systems and conduct activity that appears trustworthy because it originates from a legitimate user. Once an account is compromised, attackers may exploit stored payment methods, redeem loyalty balances, or make fraudulent purchases that resemble legitimate customer behavior.

Across the Sift network, account takeover activity fluctuated significantly throughout 2025. Attack rates were highest early in the year before declining later, suggesting waves of credential-based campaigns followed by improved defenses or attackers shifting to other targets. Consumer experiences reflect the scale of this threat, with 21% reporting* that they experienced account takeover in the past year.

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Account Takeover Across Industries and Consumer Platforms

Account takeover affects a wide range of digital platforms, particularly services that store payment credentials, loyalty balances, or other forms of digital value. While financial accounts are common targets because they connect directly to funds, many everyday platforms are also vulnerable. Travel services, for example, often store loyalty points and saved payment methods that can be quickly monetized once an account is compromised.

Data from the Sift network shows that exposure varies across industries. Internet and software platforms recorded the highest average account takeover rates in 2025, followed by digital commerce and travel platforms where large numbers of accounts and stored credentials create attractive targets. Finance and fintech platforms reported lower average rates, but remain highly sensitive environments because compromised accounts can lead directly to financial loss. Consumer experiences reflect similar patterns, with social media and financial accounts most frequently compromised and services such as food delivery, subscriptions, and e-commerce also common targets.

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Authentication Trends and Security Behavior

Authentication remains one of the most important defenses against credential-based attacks, but organizations must balance stronger controls with a smooth customer experience. Across the Sift network, two-factor authentication (2FA) adoption fluctuated during 2025, declining through the middle of the year before rising again toward the end. The increase later in the year suggests many organizations strengthened authentication requirements following periods of elevated account takeover activity.

Consumer attitudes toward security reinforce this trend. Concern about online fraud remains widespread, and nearly three out of four consumers report taking additional steps to protect their accounts. The vast majority (93%) also say they are willing to accept extra verification during login or checkout when it helps reduce fraud risk, giving organizations greater flexibility to strengthen authentication while maintaining customer trust.

Payment Fraud Trends

While account takeover activity fluctuated throughout the year, payment fraud attack rates remained relatively stable across the Sift network. This consistency suggests many organizations have strengthened transaction monitoring and adaptive fraud controls even as digital commerce activity continues to expand.

However, fraud tactics continue to evolve. Attackers increasingly compromise accounts first and then monetize those accounts through transactions that appear legitimate because they originate from trusted users. Consumer experiences highlight the persistence of this threat, with more than one in four consumers reporting they experienced online payment fraud in the past year.

Payment Fraud Across Industries and Consumer Platforms

Payment fraud most often occurs in environments where payment credentials are stored and transactions occur frequently. Financial accounts remain the most common target for payment fraud, reflecting the direct access they provide to funds. However, many everyday digital services—including subscriptions, social media platforms, and food delivery apps—also store payment information, creating additional opportunities for fraud when accounts are compromised.

Industry benchmarks across the Sift network highlight meaningful differences in fraud exposure across sectors. Travel and ticketing platforms recorded the highest average payment fraud rates in 2025, reflecting the high value of bookings and the resale potential of travel purchases. Food and delivery platforms and internet services also experienced elevated fraud rates, driven by high transaction frequency and stored payment credentials. Finance and fintech platforms remained a significant target due to their direct connection to financial accounts, while digital commerce platforms recorded lower average fraud rates overall. Consumer experiences mirror these patterns, with financial accounts the most common location where fraud is reported, followed by subscription services, social media platforms, and food delivery apps where payment credentials are frequently stored.

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Payment Methods with the Highest Fraud Pressure

Fraud exposure varies significantly depending on the payment method used. As businesses expand payment flexibility to support customer choice and conversion, fraud teams must evaluate how each payment type introduces different risk patterns. Payment methods tied to stored value or alternative payment flows—such as rewards programs, financing options, and cryptocurrency—tend to experience higher fraud rates because they can be quickly monetized and often have fewer traditional fraud protections. In contrast, more established payment methods such as credit cards and electronic fund transfers typically show lower fraud rates due to stronger verification controls and mature fraud detection infrastructure.

CHAPTER 2

Fraud, Consumer Trust, and Platform Loyalty

Fraud incidents can have a lasting impact on customer trust and long-term platform loyalty. When consumers experience fraud, their willingness to continue using a service often depends on how effectively the company responds and resolves the issue. A majority of consumers (52%) say they would stop using a platform entirely after experiencing fraud, while others say their decision depends on the company’s response. These findings highlight how fraud prevention and incident response play a direct role in protecting customer retention and brand reputation.

Consumers also view fraud prevention as a shared responsibility across the digital ecosystem. While banks and card issuers are seen as primary defenders against fraud, consumers increasingly expect websites, apps, and payment providers to play an active role in protecting their accounts and transactions. This shared responsibility model underscores the importance of collaboration across financial institutions, digital platforms, and users to maintain trust and security online.

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Payment Security Perception and Purchase Behavior

Perceptions of payment security play a direct role in whether consumers complete online purchases. Nearly three out of four consumers say they have abandoned an online transaction due to concerns about payment fraud, highlighting how strongly trust in payment security influences conversion rates and the overall customer experience. When shoppers are unsure how their payment information will be protected, they are more likely to delay or abandon purchases.

Security perceptions also shape how consumers evaluate different payment methods. Traditional payment options continue to be viewed as the most secure, with credit cards ranking highest in consumer trust. Established methods benefit from familiarity and clear fraud protections, while newer payment models can introduce uncertainty around liability and dispute resolution. As payment options expand, maintaining transparent protections will be critical to sustaining consumer confidence.

Consumer Awareness of AI Shopping Agents

AI-powered shopping and payment agents are entering the consumer landscape, capable of researching products, comparing prices, and completing purchases automatically. Despite rapid progress, consumer familiarity remains uneven, creating a clear gap between what the technology can do and what consumers trust it to do. A large share of consumers remain unfamiliar or hesitant, making them the most at-risk group when it comes to misuse, errors, or loss of control. This puts pressure on businesses to do more than deploy automation. They must actively guide how it is introduced, understood, and used.

Industry forecasts suggest agentic commerce could generate between $3 trillion and $5 trillion in global economic value by 2030 as AI systems increasingly assist with shopping and payments. However, trust remains a key barrier to broader adoption, with concerns around unauthorized purchases and unclear accountability persisting. To close this gap, businesses will need to pair automation with clear authorization controls, transparent decisioning, and strong consumer protections, ensuring users feel informed, in control, and confident in AI-enabled transactions.

CHAPTER 3

Benchmarking
Your Fraud Program

Benchmarking fraud performance helps organizations determine whether their fraud rates reflect strong controls, rising attack pressure, or operational gaps. Internal metrics alone rarely provide enough context. A fraud rate that appears high may actually be consistent with industry norms, while stable metrics may hide emerging risk as transaction volumes grow. Comparing performance against external benchmarks—such as those available through Sift’s Fraud Industry Benchmarking Resource (FIBR)—helps fraud teams understand how their results compare to peers across industries and payment environments.

Effective benchmarking also requires looking beyond a single metric. Payment fraud rates, account takeover rates, authentication activity, manual review volume, and chargeback outcomes together provide a clearer view of fraud performance. Evaluating these signals together helps organizations understand how well they’re balancing fraud prevention, operational efficiency, and customer experience.

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Fraud no longer happens at a single point in the transaction. It unfolds across the entire customer lifecycle—from account creation and login to payment and post-transaction activity. The organizations that perform best are the ones benchmarking across all of those stages and using that visibility to make smarter risk and revenue decisions.

Kevin Lee

Field Chief Technology Officer, Sift

CHAPTER 4

Making Better Fraud Decisions

Fraud prevention is evolving from a reactive operational function into a strategic capability that directly influences revenue growth and customer trust. The Sift Platform processes more than one trillion events annually, allowing organizations to combine internal data with global intelligence across the digital economy. By combining advanced machine learning, network intelligence, and automation, fraud teams can move beyond reactive investigation toward proactive fraud prevention—protecting revenue while maintaining seamless customer experiences.

*On behalf of Sift, Researchscape International polled 1,065 adults (aged 18+) across the United States via online survey in February 2026.

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