Rising Card-Not-Present Fraud Drives Significant Changes to Consumer Online Shopping Behaviors

Resulting in silent revenue killers for financial institutions and merchants

Fraud prevention solution company releases new research unveiling CNP Fraud long-term consequences

Fort Lauderdale, FL – April 6, 2015 – As the U.S. continues transitioning to EMV credit and debit cards, card-not-present (CNP) fraud has taken root, growing rapidly and targeting ecommerce sales. As the landscape alters, a key question is how increasing fraud impacts consumer behaviors. CvvPlus – an online fraud prevention solution – provided by Tender Armor, in partnership with Sparks Research, today released a report titled “CNP FRAUD CONSUMER IMPACT: ANXIETY THAT REDUCES CREDIT AND DEBIT CARD USAGE”. The study delves into the lingering aftermath of CNP fraud regarding shifting consumer shopping behaviors, consumer security concerns, payment card usage, and financial institution (FIs) fraud prevention recommendations.

Mounting CNP credit and debit card fraud causes more harm than just the billions of dollars in losses and expenses to FIs and merchants. CNP credit and debit card fraud creates cardholder anxiety and negatively affects consumers’ online shopping behaviors, much to the detriment of FIs and e-commerce merchants.

In fact, the study found that 55% of cardholders decrease online shopping, reduce payment card usage, and close payment card accounts after facing a fraudulent event. FIs and merchants need to act now, introducing new CNP fraud prevention methods that diminish rising losses and costs while alleviating cardholder angst. Industry providers will benefit from introducing new fraud prevention methods that do just that. It is paramount that fraud prevention solutions promote consumer trust and confidence that the consumer’s payment card data will be kept safe while shopping online.

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“Our study revealed that 78% of online shoppers want more protection for their payment card data when shopping online,” said Madeline Aufseeser, CEO of Tender Amor. “Consumers desire more security while transacting online. Consumers stated that their online shopping declines after a fraud event. Lower card usage, card account attrition, and less shopping are the silent revenue killers for FIs and merchants alike. Avoiding these long-term ramifications, is in the industry’s best interest. It ensures consumers feel safe clicking the “buy” button.”

To deliver “CNP FRAUD CONSUMER IMPACT: ANXIETY THAT REDUCES CREDIT AND DEBIT CARD USAGE” 1,013 ecommerce credit and debit card shoppers participated in an online survey during Q1 2016.

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About Tender Armor

Based in Fort Lauderdale, FL, Tender Armor brings to market new technologies to prevent fraud on payment cards. Tender Armor is led by payments industry luminary, co-founder, and CEO Madeline K. Aufseeser. Tender Armor’s premiere product, CvvPlus is a real-time, dual-factor, out-of-band fraud prevention solution primarily for card-not-present (CNP) payment card transactions. CvvPlus can also be utilized in any card present transactions requesting a CVV2 or payment card security code to complete the transaction.