A win/win for e-commerce
Written by Sharon Gal Franko, SVP Partnerships, Digital Payments at Nuvei and Neil Smith, Head of Business Development & Partnership, EMEA/UK, Forter
We live in a world where online payments have almost become the norm, so it is vital that e-commerce merchants offer truly frictionless, secure shopping and checkout experiences. However, innovations in payments have been a double-edged sword for retailers – it allows them to reach more customers, but it has also led to a rise in online fraud.
At Nuvei, we work hard to keep our systems on the cutting edge of fraud protection technology, with proprietary risk management tools, identity manager, and an advanced fraud engine. We’re proud to announce a further development in this regard – a partnership with Forter, one of the world’s leading online fraud-prevention companies.
The collaboration means that the retailers and online marketplaces – of all sizes and industries – that already benefit from Nuvei’s global full-stack payment technology, fraud system, and conversion boosting tools, now also have the security of Forter’s robust real-time fraud and abuse prevention platform. Forter processes over $200 billion in online commerce transactions and protects over 800 million unique consumers globally. Combining the power of Forter’s global network with Nuvei’s Native Commerce Platform empowers merchants to increase and fully optimize transactions in today’s worldwide digital marketplace.
As the number of online consumers and transactions continue to rise worldwide, merchants need to create a truly frictionless, secure shopping and checkout experience,” explained Philip Fayer, Chairman and CEO, Nuvei. “To capitalize on an increasingly global marketplace, they must also accept their clients’ preferred forms of payment, stamp out fraud, and reduce cart abandonment to capture immediate and recurring revenue. Together, Nuvei and Forter are delivering just that.”
The common fraud challenges of e-Commerce retailers
COVID-19 has transformed the e-commerce ecosystem, forcing retailers to adapt their payment strategies to satisfy customers who make most, if not all, of their purchases online. In order to succeed in e-commerce, businesses must be able to accept their customers’ preferred payment methods and have up to date tools to prevent cart abandonment, a strategy which has been proved to increase conversions.
However, at the same time, the growth in online activity has left businesses vulnerable to significant revenue losses from a number of directions, and this is especially true of online marketplaces that deal with multiple vendors.
So pervasive is the problem that the Mercator Advisory Group estimates that cybercrime is costing the world approximately $6 trillion every year.
Retailers well know of the many forms fraud can take. For example, account takeover, otherwise known as identity fraud, has grown in terms of both sophistication and numbers of attempts. Even biometric authentication isn’t foolproof anymore, as scammers can buy ‘digital masks’ online, often derived from stolen data.
Another problem that businesses face is chargeback abuse, which costs them billions of dollars a year. All disputes are a problem for retailers, who at the very least will have to devote resources to proving their case, but more often have to refund the purchase, pay a fine, and suffer from damaged reputations.
And as if these different types of fraud were not enough to deal with, they bring two additional sources of financial loss.
The first is false declines, or the rejection of legitimate transactions. These negative experiences have a significant effect on a merchant’s return business. 28% of consumers worldwide report having experienced this, a huge number partly caused by the influx of new e-commerce customers who don’t have historical data which can be used to gauge their intentions.
The other source of revenue loss is increased security requirements demanded by regulators which can lead to purchases abandoned by customers frustrated by inconvenient authentication processes.
It’s clear that fraud and abuse prevention must be a central part of the payment strategy of any online retailer and marketplace. But at the same time, the protection has to be sophisticated enough and equipped with the right kind of data, to distinguish between a real customer and a fraudster.
What the Forter-Nuvei partnership and solution offers
The aforementioned factors have led to the strategic partnership of both companies. By combining Forter technology with Nuvei’s network of more than 200 acquiring partners, agnostic routing engine, and over 450 supported alternative payment methods, we can offer a robust and agile package for online marketplaces that’s able to analyze customer behaviors to differentiate between genuine and suspicious transactions, and then route genuine transactions through the acquirer most likely to approve them.
Forter uses its global data network to analyze customer behavior, gauging the trustworthiness of each transaction in real time by analyzing data points such as personal information, previous purchases, geographic location, and IP address location. Liron Damri, Co-founder and President of Forter, commented
Forter’s global data network is a game-changer for the online e-commerce industry. We enable merchants to fight fraud together, making it much easier to identify attacks across the network, but more importantly, to easily recognize legitimate customers and allow them to interact freely with merchants.”
In combination with Nuvei’s routing engine which triggers PSD2 3DS2 authentication only when necessary, unnecessary inconvenience to customers is avoided, while maintaining full compliance with Strong Customer Authentication. The combined solution provides merchants with a global solution that meets regional and country-specific compliance requirements.
This partnership is a major milestone for both companies, and a testament to the increasingly collaborative nature of the payment ecosystem – something which we at Nuvei are very enthusiastic about. For Nuvei partners, the ability to maximize conversions with easy payment journeys while at the same time effectively stymieing fraud-based revenue loss, is a proposition that can’t be passed up during these difficult economic times.