E-commerce is a big thing in many economies, including Kenya, because it allows shoppers to access products and services from the comfort of their internet-enabled devices. Hundreds of these platforms exist in the country and continue to grow from time to time.
However, a new study has determined that 15% of all global e-commerce transactions reviewed between November 24-28 were potentially fraudulent. For transactions originating from Kenya, 5.4% of e-commerce transactions during that period were suspected to be fraudulent.
The analysis, which was done by TransUnion, also determined that the average number of suspected digital fraud attempts on any given day during that holiday period globally was 82% higher than during the rest of the year (Jan. 1, 2022, to Nov. 23, 2022).
For transactions originating in Kenya, this percentage was 15% lower than during the rest of the year and 42% higher than in the same period in 2021.
The study also revealed the share of suspected digital fraud attempts for each individual day in the holiday shopping period for transactions in Kenya and globally.
TransUnion also revealed in the analysis the top types of fraudulent e-commerce transactions globally. This year, promotion abuse (user abuses site promotions such as refer-a-friend, free giveaways, etc.) and account takeover (someone other than the owner of an account uses it without permission, indicating that the account has been maliciously compromised) were the top types of digital fraud in retail.
Risky Transactions During Holiday Period
|Day||Transactions in Kenya||Globally|
|Thursday, November 24||25%||14%|
|Friday, November 25||20%||25%|
|Saturday, November 26||16%||21%|
|Sunday, November 27||15%||18%|
|Monday, November 28||23%||22%|
The increase of suspected digital fraud during the traditional busiest days of the holiday shopping season occurred as consumers express concern about being victimized.
TransUnion’s 2022 Consumer Holiday Shopping Survey found that 63% of Kenyan consumers are concerned with being victimized by online fraud this holiday season.
TransUnion monitors digital fraud attempts reported by businesses in varied industries such as gambling, gaming, financial services, healthcare, insurance, retail, and travel and leisure, among others. The conclusions are based on intelligence from billions of transactions and more than 40,000 websites and apps.
“Online retailers must equip themselves with the proper tools to detect fraud at the first warning sign, and without inhibiting the consumer journey,” said Morris Maina, chief executive officer TransUnion Kenya. “It’s more important than ever that these online retailers implement holistic fraud solutions that are able to verify customer identity and authenticity at the very beginning of a transaction without resulting in false positives that may cost them legitimate transactions.”