Over the past few years, the entire world was under lockdown due to the pandemic. Digitalization boomed due to lack of mobility and the restriction imposed by the official authorities on not leaving the house for any reason. It changed the entire mindset, and a new digital world with a rise in e-commerce frauds in India.
During this phase e-commerce websites served as the survival kit for people. In addition to buying groceries and clothes online, it also became a go-to destination for various accessories like medicines, learning kits, bill payments etc. As per, recent reports by government officials, E-commerce has witnessed an order volume growth of 17% as of June 2020 and about 65% growth in single brand e-commerce platforms.
However, it has come into consideration that with the rise in popularity, e-commerce web portals also are experiencing a rise in frauds and other cyber-attacks. E-commerce frauds in India has managed to hack more than 570 e-commerce websites across 55 countries, including India in just three years.
Some of the most common e-commerce frauds in India done by cyber-criminals include:
- Payment/Account fraud or Identity theft: This is one of the most common frauds done with e-commerce websites. They manage to gain access to credit card and other bank details. Sometimes they also get access to your email id, name, address, and personal devices through e-commerce’s websites.
- Friendly fraud: In this type of fraud, it may or may not involve an actual customer. However, it qualifies as fraud since the customer/fraudster paid for the purchase but claimed to have never received the delivery. The merchant is then forced to re deliver the product, refund the disputed amount, or face a chargeback.
- Shipping Fraud: This kind of fraud is closely associated with identity theft account fraud where fraudsters get access to the customer’s information and use it to track and re-direct the shipment to a different address. In this case, the customer does not receive the product, although the product has been shipped.
- Triangulation fraud: More like an advanced version of Phishing. To carry out a Triangulation Fraud, scammers create a fake storefront and record the credit card details. Then they place an order with the original store. Later recorded credit card details are used by fraudster to order items worth high tickets.
Impact of Triangulation Fraud on e-commerce stores:
- Chargeback by the credit card owner
- Revenue loss due to products being shipped
- Negative branding
Some of the most effective ways of e-commerce frauds in India prevention as per RBI guidelines:
- Cross-verify suspicious transactions: Since hackers have access only to cardholders’ data and not to their email address, e-commerce people shall rely on cross-verification emails to sustain such frauds. Do not hesitate to contact your bank if you suspect any kind of suspicious transaction that has nothing to do with the purchase.
- Regular checks and Data Backup: It may not sound interesting but doing regular security checks for your website is important. Checking faults and vulnerabilities in advance can help one remain rectify the loopholes and keep the updates on points. Data-back up is another mandatory practice that can safeguard one for an expensive fraudulent attack!
- IP Address Verification: Discover anyone who uses multiple cards from the same address and limit their access to your site. If we opt for IP address verification, online businesses can easily stop their platform from getting misused.
- Training Employees and educating consumers: Lastly, educating consumers about safe online transactions is very significant. It ensures that they get a secure gateway solution to ensure their transactions are secure and safe. Securing payment methods not only fight against frauds but also build a long-term trust among consumers, thereby building brand loyalty.
Also, it is the employees responsibility to follow security protocols and adhere to strict codes of conduct when administrating and operating various aspects of the e-commerce website to ensure there will be a vigilant and internal check on challenges in advance.
What should you do if you or someone you know has been a victim of E-Commerce Fraud?
If you or someone you know has been a victim of E-Commerce Fraud, there are solutions for you. SingleDebt’s legal team can help handle the legalities for you. We would also recommend contacting your local police station and informing them of what has happened and try gather as much information as you can as this will significantly help with the investigation. We would also recommend you speaking with your bank and informing them that you have been a victim of fraud online. Finally, we would strongly recommend you report this to the online cybercrime website in your state. For cybercrime in Mumbai, you can file a report on this site https://mumbaipolice.gov.in/CCC Contact SingleDebt on +91 961 910 3594 or fill out the form either on the home page or contact page.
As we all know, e-commerce frauds in India is increasing day by day. It is the responsibility of cybersecurity to ensure that websites are protected from cybercrime by practicing the above-mentioned methods. As a result of lack of knowledge and regular security practices, cyber frauds are on the rise. This is causing heavy losses to the web portal as well as to customers. It is important that e-commerce companies take up the matter of protecting their online platforms with the advanced tools that ensure customer protection as we move forward with virtual transactions.