Posted in News
July 12, 2022

What is Friendly Fraud and How to Prevent it?

COVID-19’s sudden advent is the purpose for the 2.05 billion online shoppers worldwide last 2020. 80% of people said they prefer shopping online to in-store. 63% agreed that purchasing items through their mobile device is much better. Despite these innovations, 66% of people still approve of buying in-store. However, there has been a sudden protocol of reducing individuals going outside since there has been a plague.

Therefore, specialists forecasted an annual revenue regarding eCommerce sales’ increasing up to $6.5 trillion by 2023. Once this course is unchanged, there is no doubt that e-marketing can hit the predicted $8 trillion profit. Regardless of its flourishing, friendly fraud can be one of the causes that digital marketing could not reach the forecasted revenue.

What is it anyway?

Friendly fraud, also known as chargeback fraud, is when customers purchase online with their credit or debit card. They will then request a refund from the issuing bank even after receiving the said product or service. 

Such an occurrence happens when there are two people in a joint account. The buyer may purchase without letting the other know. Some consumers are already old that may have forgotten they bought the merchandise. On the other hand, some clients take advantage of their rights with spiteful intent. These types of buyers are what people should avoid and put a halt to through digital onboarding. They will do anything and say all the reasons they could think of to get away with what they bought and obtain it for free.

So, how to prevent them from doing friendly fraud?

  1. Prioritize biometric authentication like passwordless FIDO2.

This verification asks for a biometric digital signature before proceeding with a purchase. It supplements a 3D risk-based authentication, adding relevant FIDO clarification data. 

Additionally, a person cannot buy something without the cardholder’s biometrics.

     2. Collect relevant information about the customer’s purchase and personal data.

Accumulating details is highly significant. It keeps the company on track as well as the client. Moreover, it helps the enterprise give purchasers a simple and quick email about the product or service they bought. This movement is a helpful reminder for them.

Aside from these, enterprises must carry out chargeback detection strategies.

Secure, private authentication for your future. Learn more about them, and the other ways of friendly fraud prevention on the infographic below brought to you by Login ID:


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