AI-Powered Fraud to Cost E-commerce $107 Billion by 2029
Over the next five years, a significant increase in e-commerce fraud is anticipated due to the widespread use of artificial intelligence. According to a report by Juniper Research, the volume of fraud is projected to rise by 141%, from $44.3 billion in 2024 to $107 billion in 2029.
The report highlights that AI-powered tools enable criminals to stay ahead of security systems, making attacks more sophisticated and widespread. In particular, the automation of creating fake accounts and synthetic identities greatly facilitates the deception of trading platforms, overwhelming traditional rule-based security systems.
The study’s authors stated that e-commerce companies should integrate AI-driven fraud prevention systems to detect new fraud tactics promptly. This is especially relevant for large retail companies in developed countries, which are more frequently targeted by cybercriminals, such as when stolen credit cards are tested.
The research also outlines key strategies that can assist fraud prevention solution providers in reducing the number of fraudulent transactions online. Specifically, it offers recommendations for improving methods of detecting suspicious activity and enhancing the accuracy of identifying genuine users. The forecasts cover areas such as the purchase of airline tickets, digital and physical goods, with a breakdown by online and mobile transactions, as well as consumer preferences.
Juniper Research advocates the use of AI as a tool to combat fraud. AI-based systems can detect unusual spending patterns, sudden changes in customer behavior, and instances where multiple accounts are linked to a single device. However, such systems require vast amounts of data to operate effectively, and their implementation demands substantial resources, which may also result in false positives.
