ACI: E-Gift Cards and In-Store Pick Up Drive Holiday Fraud Spikes

Jan. 21, 2016

ACI: E-Gift Cards and In-Store Pick Up Drive Holiday Fraud Spikes E-commerce transaction growth outpaced growth in fraudulent transactions during the just completed holiday season, according to data from payments processor ACI Worldwide. The Naples, Fla.-based payments company analyzed hundreds of millions of transactions from the 2014 and 2015 holiday seasons and found overall online transactions grew 21 percent from last year to this year and fraud attempts grew 8 percent. Fraud attempt rates spiked most on Christmas Eve (2.4 percent), Thanksgiving (2 percent), Black Friday (1.8 percent) and holiday-shipment cutoff days (1.6 percent).

ACI said it saw two trends that could have driven spikes on Christmas Eve: the popularity of electronic gift cards as a last-minute gift and an increase in the ability to buy online and pick up in-store. According to ACI’s data, e-gift cards have the highest fraud attempt rate of any product its merchants sell and buy online/pick up in-store has a higher fraud attempt rate than any other delivery method. While the company expected both scenarios, the fraud numbers related to in-store pick up exceeded its expectations. In November, ACI predicted fraud attempts on buy online/in-store pick up transactions to increase 28 percent. When the actual numbers were tabulated, it found fraud attempts on that delivery method increased 47 percent.