4 out of 10 merchants see managing mobile fraud as biggest challenge

According to the latest data from Kounts 2016 Mobile Payments & Fraud Survey, the majority of merchants are overwhelmingly incorporating mobile payment options into their online and mobile commerce strategies. But, they are unaware of the type of risks these new technologies bring or how they even look like.

The report also examines where most organizations stand regarding the mobile wallet race. Card associations (85%) and issuers (75%) are the most likely to support mobile wallets, as many have made efforts to ensure the cards they issue can be used across multiple mobile wallets. 

Findings indicate that over 82% of merchants actively support the mobile channel today, up from 54% at the time of the inaugural survey and 69% in 2015. Mobile importance, acceptance and revenue has jumped: merchants earning at least 30% of revenue in the mobile channel more than tripled to 29% from 9% last year.

Despite nearly half of card issuers (44%) and merchants (41%) indicating that mCommerce is ‘somewhat riskier’ or ‘far riskier’ than standard ecommerce, the mobile consumer experience trumped security concerns among the top worries organizations had for the mobile channel. Over 40% of merchants (43%) are unaware of the share of total fraud coming from the mobile channel. Organizations are more likely to say mobile channel fraud is staying about the same compared to last year (28% vs. 21%), than they are to say that it is increasing (15% vs. 13%).

Despite the increase in mobile fraud risk over the years, the number of organizations considering it ‘very important’ to be able to detect mobile transactions only increased slightly since 2011 (from 39% to 42%). About one-third of merchants (33.6%) have made the transition to EMV, but nearly nine in ten merchants report either that mobile fraud hasn’t increased or they are uncertain since the EMV shift (46 and 42% respectively).

For the second consecutive year, merchants are more likely to state that standard ecommerce fraud tools are sufficient to support risk management in the mobile channel: 36% of merchants have this opinion today, the highest rate since the inaugural survey (37%).