A joint study released this week by ThreatMetrix and the Ponemon Institute, looks at the increase in mobile commerce activity, and how this trend plays a role in the prominence of fraudulent mobile transactions. The study examined how comfortable consumers are with sharing their mobile location with a company. More than half of respondents said they would be willing to share this information if it meant protecting against online fraud. Of those, the majority (37%) feel most comfortable sharing their location information with banks, followed by a certified third party that monitors potential fraudsters (32%).
“With the rapid growth in mobile activities, brands need to consider a cohesive approach to fraud prevention across all devices and not just PCs,” said Alisdair Faulkner, chief products officer, ThreatMetrix. “Some of our social networking customers already see about 20% of activity coming from mobile transactions as opposed to web. The good news is that mobile commerce has arrived. The bad news is that fraudsters know it.”
According to ThreatMetrix data, mobile transactions are more likely to be fraudulent than web-based transactions. Based on a sample of more than 200 million transactions from across 1,000 sites, ThreatMetrix found that an average of 2% of worldwide transactions came from a mobile device, with the most originating in the U.S. (4%).
When mobile transactions are broken down by industry, social networks top the list (5.4%), followed by alternative payments (2.5%) and e-commerce (2.4%). “The Social Local Mobile revolution has arrived and will be a leading indicator for mobile transactions across other industries,” added Faulkner. Mobile commerce is on the rise, and it is estimated that by the end of 2013 12.5% of e-commerce transactions will be from a mobile device, according to Gartner.
According to Faulkner, “Brands need to consider last-minute purchases, and the fact that customer convenience will demand real-time response. Fraud platforms need to be in real-time, with context-specific policies to adapt to changing customer behavior. Otherwise, brands risk good customers getting bounced by outdated fraud models.”