10 Reasons Why You Can’t Afford to Ignore Payment Fraud

#2

Fraud will become an even bigger problem in the travel industry as digital bookings are on the rise around the world.

According to Phocuswright, online gross bookings in the United States jumped 6.8% in 2017 to nearly $172 billion, and similar growth is predicted for 2018.

In addition, online travel bookings are expected to increase from 48% in 2017 to 53% in 2021.

#4

Fraud affects reputation management.

Customers have an expectation that information they share is safe and that companies will protect them from account takeover.

A breach of that trust can cause permanent damage to a brand.

And through the power of social media, one incidence of fraud has a ripple effect on a brand’s image.

#7

Fraud affects the bottom line.

Travel often involves high-dollar transactions that happen quickly, so companies must be fast to detect and prevent fraudulent purchases.

In addition to missing out on legitimate ticket revenue, travel brands can end up paying chargebacks, fines and processing fees – adding up to hundreds, even thousands, of dollars down the drain on each fraudulent transaction.

A Phocuswright study found that travel agencies spend an average of 1%-2% of their revenue to manage fraud.

The rate is only slightly lower for airlines as carriers report rejecting or canceling almost 4% of bookings due to fraud.

#9

Fraud prevention strategies can bolster confidence from stakeholders.

These can include investors, partners, suppliers, insurance companies, employees, etc.

A case of fraud that affects a company’s reputation can also affect its market value, creating a negative ripple effect throughout these stakeholder communities.