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Digital Identity, Security & Online Fraud

Merchants under pressure to increase digital sales while managing fraud

Monday 25 June 2018 | 02:36 PM CET

A report from ACI Worldwide and Ovum reveals that merchants feel under pressure to increase digital sales while managing fraud and protecting customer data at the same time.

According to the 2018 Global Payments Insight Survey: Merchants, 1 in 4 European merchants in the retail, travel and hospitality, and digital goods sector (26%) has experienced data theft and the majority (61%) believe they are at greater risk of a data security breach today than they were a year ago.

While the need to manage fraud, and protect customer data remains a top issue, the study also shows that achieving sales via digital channels remains the top priority for merchants and retailers across all sectors - 58% of merchants surveyed said that lost sales (basket abandonment) in the digital channels is a bigger concern than fraud. Almost half (48%) said that they are willing to face an increased risk of fraud if it means more sales.

“Our research shows how crucial digital channels are to the success of merchants across sectors. For many of them, the website is now their most important storefront, and seamless and frictionless customer experience are top priorities, said Andy McDonald, vice president, merchant payments, ACI Worldwide. “However, there shouldn’t be a trade-off between customer experience, sales growth and security. The right omnichannel strategy will offer customers a seamless payments experience, support loyalty and revenue growth, while at the same time provide maximum security.”

Other key findings of the report include:

  • 80% of European merchants believe that real-time payments will replace the use of debit or credit cards over time (in the Netherlands, 100% of merchants hold this view; in Belgium, 87 percent; and Germany, 84 percent)

  • 76% of merchants believe that real-time payments will help to save their business money

  • 63% believe real-time payments will reduce their payments acceptance costs

Key factors driving investment into payments infrastructure include: enhanced payment acceptance capabilities, more consistent customer experience across store and digital channels, and supporting cross-border sales and international expansion.

The survey was conducted between December 2017 and January 2018 among 250 European merchants and retailers across the retail, travel and hospitality, and digital goods sector. It is part of a four-part Ovum series, providing insight into current thinking in the industry across financial institutions, merchants and billing organizations such as higher education, consumer finance and insurance. Overall, it included a total of 1,032 executive respondents across 13 industry sub verticals in 19 countries.

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