experiences in managing e-commerce fraud? · ideal in nl elv strong in de bc/mistercash in be...
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Experiences in Managing
e-Commerce Fraud?
• 2013-05-22
Where our input is from?
52,000businesses worldwide trust Ogone to manage, secure and collect their online and mobile payments
137 Motransactions processed in 2012 (worth € 16.6 Bn)
200+acquiring partners and banks
200+resellers, industry partners and shopping carts softwares
1000+new merchants per month
20+white-labels
85+international, local and alternative payment methods
Worldwide
Trends & Experiences
Supporting Merchant
360 degrees
Trends & Experiences
A few observations
Is fraud a priority elsewhere?
• Fraud rate NL : 0.4%
• Fraud rate FR : 1.4%
• Fraud rate UK : 0.8%
• Fraud rate DE : 0.6%
• Fraud rate BE : 0.6%
Analysis done through 200+ merchants from all size, manyindustries and various gateway services.
Optimized conversionThink global, Act local
iDEAL in NL
ELV strong in DE
BC/Mistercash in BE
Credit Cards
in BE, FR, UK
PayPal in UK & DE
3-D S discrepancies
AVS in UK
Chargeback risk?
3-D Secure adoption*
Analysis done through 12 M+ transactions during the month of October 2013 (includes all payment methods)
60% 62%
18%
32%
69%
21% 21%
37%
BE NL FR DE CH SP IT Total
Supporting merchants360 degrees
What is Merchant “Cost of Fraud” ?
Sound understanding of
direct & indirect costs
Evolution Monitoring
Direct financial
costs
Missedrevenues
Preventioncosts
Data is key
Personal data
Billing/Shipping data
Card data
Shopping basket data
Travel related data
Card country
Departure-Destination
Average amount
IP country
Time to departure
+combination of
all the above
Get a better understanding of fraud
patterns and caracteristics
Affiliate fraud
Social engineering
Friendly fraud
+
Real time Behavior mapping
Rules & Profiling
Device Fingerprinting
Smart authentication (3-D Secure, AVS)
Etc.
Blacklists, greylists, whitelists
Use cross-merchant databases
• Mobile top up provider• Propose recharge of 25 European mobile phone networks• 50 000+ transactions per month• Triple digit yearly growth since 2010
Key Challenges
• Larger volumes & better visibility led to more fraud threats
• International development. First stop: France
More fraud attempts, less conversion
Narrowed margins
Situation before
30% of orders were blocked
Fraud rate above 1%
Solutions
• Implementation of a second layer of protection
• Loosen their fraud rules and velocity checks
• Use of the latest technologies such as Device Fingerprinting
• Better profiling of Positive and Negative customers
• Outsource the reviewing of suspicious transactions
After 2 months
Air India Your Palace in the Sky
Flag carrier of IndiaFounded 15 October 1932
•109 Aircraft• 60 Domestic destinations• 31 International destinations• 19 Countries
Key Challenges
• Two brands Merger – Air India and Indian Airlines
• Bottleneck in Scalability of Manual Review
• Team Awareness
• Cleaner fraud with IP, Card country and others Matching
• Travel agent VS Fraudster
Situation beforeBusiness discontinuity threatens…
90% of orders were manually
reviewed
Time taken for review was 8 hours
After 6 months
2 hours
Information available on
1 single screen
8 hours
Need to review data from
different sources
Lead time for manual review reduced
Reduced time between booking & flight…
Till Last Minute
For international & domestic
flights
From 72 hours
Charge back rates fell from 0.34% to 0.01 %
REVIEW REVIEW
3-5%90%
Conclusion
• Fraud losses were drastically reduced
• Increase in ecommerce sales
• Order acceptance up to 35%
• Reduced Cost and time taken for manual review
• Profiled Positive and Negative Customers
• New routes were adopted easily
www.ogone.com
Thank you
Fraud preventionBack-Office support services
Collectingservices
Mobile paymentPayment
processing
Expertise in all sectors
HOSPITALITY AND LEISURE
RETAIL
TELECOM/INTERNET /INSURANCE
Expertise in all sectors
AIRLINES / TRANSPORT
UTILITY / GOVERNMENT
TICKETING
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