Anti-fraud measures won’t be enough to stop friendly fraud on its own.
More than eight in 10 retailers have reported an increase in friendly fraud, according to Chargebacks911’s latest report. Friendly fraud, where customers file claims for charges they knowingly made, continues to plague the payments industry. **63%** of retailers surveyed saw an uptick in such claims over the past year, with **22%** experiencing a significant spike.
Friendly fraud can be particularly damaging for merchants, as it can result in chargebacks, fines, and even lawsuits. It’s a problem that’s not only costing businesses money but also eroding trust in the payment process.
That’s why some retailers are turning to artificial intelligence (AI) to mitigate the damage. AI-powered tools can monitor transactions in real-time, flagging suspicious activity and helping to prevent friendly fraud. By analyzing patterns and behavior, AI can identify potential issues before they become major problems.
AI is also being used to improve customer service, helping to resolve disputes and prevent chargebacks. For example, some merchants are using chatbots to address customer concerns and clarify policies. This proactive approach can help reduce the number of disputes and minimize the risk of friendly fraud.
What this means:
Merchants need to be proactive in addressing friendly fraud, and AI can be a valuable tool in the fight against it. By using AI-powered tools to monitor transactions and improve customer service, businesses can reduce the risk of friendly fraud and protect their bottom line.
