Commerce studies reflect digital-first future

Future financial services will be inclusive, agile and digitized, according to separate reports by Nexi Group and LexisNexis Risk Solutions. Researchers from both companies expect merchants to increasingly leverage advanced processing technologies to deliver secure, seamless in-store, in-app and online commerce.

2022 Payments Outlook, published March 29, 2022, by Nexi Group subsidiary Nets, cited five consumer trends that reflect a fundamental shift from transactional to experiential commerce. Consumers are using mobile devices as a hub to navigate the shopping journey and make informed decisions at points of interaction based on real-time data, Nexi Group researchers noted.

The report examines commerce through multiple lenses of consumers, technology, markets and regulatory landscapes, and cites the following five trends:

1. I, the consumer: Consumers expect transparent pricing and ethical practices at the stores and websites they frequent.

2. Pay as I please: Consumers want to pay with their local currencies, loyalty and rewards points, digital wallets, and contactless and preferred payment methods.

3. Beyond the POS: Consumers expect all commerce channels to be interchangeable while providing a consistent customer experience that keeps the consumer at the center of each path to purchase.

4. Data, the enabler: Consumers must see a clear value benefit to be willing to share their data and receive personalized customer experiences that provide relevant services and offerings along with enhanced protections against fraud.

5. Platforms for success: Consumers are dependent upon the platforms they use, which may create bottlenecks to omnichannel commerce, and this presents opportunities for merchants and payment service providers to advance interoperability through a robust platform ecosystem.

Keeping bad actors at bay

Balancing Risk and Reward, The New Mobile Battlefield, published March 24, 2022, by LexisNexis Risk Solutions, surveys the threat landscape in the third and fourth quarters of 2021, providing digital commerce global and regional data and trend analysis. The biannual report found a 20 percent lift in year-over-year attack rates across financial services, up 41 percent over the first half of 2021 as economies reopened following the pandemic, researchers noted.

"While fraudsters are continuing their use of automated bot attacks seen throughout the pandemic, the human-initiated attack rate seen in the network rose for the first time since 2019, with financial services being the clear target," researchers wrote. "As anticipated for some time, fraudsters are now starting to capitalize on the fruits of their bot labors during the pandemic, using them in sophisticated attacks and scams."

Researchers further noted that fraudulent account creation and account takeover fraud are continuing to scale. Warning that no public or private sectors in the world, including celebrities and government officials, are immune from these types of attacks, they cited the following four trends:

1. Mobile fraud: Driven by predominant mobile usage among young consumers, mobile app-only fintechs and emerging populations that move straight to mobile, mobile fraud presents abundant opportunities to threat actors.

2. North American scams: Triggered by cryptocurrency excitement, burgeoning consumer savings, relief checks and increased online shopping due to Omicron, scammers drove 15.3 billion malicious attacks in the United States and Canada in the second half of 2021, up 22 percent year over year, and 157 million human-initiated attacks, which increased by 50 percent.

3. Automated bot attacks: Evident throughout the world, automated bot attacks increased 455 percent in Latin America, and 7 percent in the United States and Canada with 692 million attacks.

4. Prolific fraudsters: Assessing the damage that one fraudster can deliver, The Digital Identity Network observed one fraudulent digital identity attacked 35 different organizations and had 580 events associated with it, including 100 attempted account/creations/credit card applicants/loan applications; 45 attempted ecommerce purchases; 12 attempted password resets; and seven attempted changes to account details.

Stephen Topliss, vice president of fraud and identity strategy for LexisNexis Risk Solutions, urged financial services stakeholders to unite in the fight against cybercrime. "For businesses to succeed in the digital world, they need to collaborate in the fight against fraud," he said. "This can be achieved by utilizing the power of a global anonymized digital identity network and through the establishment of more focused digital consortiums among industry peers."

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