Experian’s ‘Combined Blows’ Against E-Commerce Fraud Promotes the Healthy Development of the Platform Economy

HONG KONG, CHINA -�Media OutReach - 22
October 2019 - In China, the internet platform economy is both an emerging
form of productivity organisation and a new driver for economic development. On
August 8, the General Office of the State Council issued guidelines on
promoting the healthy development of the platform economy. It said that the
prominent issues hindering the platform economy’s development should be tackled
with concentrated efforts. To promote an orderly and healthy development for
platform economy, policy guidance, support and guarantee should be intensified
according to the law of economy and trends.

As a typical representative of the
platform economy, e-commerce’s orderly and healthy development plays an
important role in many aspects, including optimising resource allocation,
boosting all enterprises’ cross-border and mutual development, encouraging mass
entrepreneurship and innovation, promoting industrial upgrading, expanding
consumer market, and, especially, increasing employment.

Platform
Economy Sweeps Across the Globe with Great Potential in Hong Kong and Taiwan
E-commerce Markets

The global e-commerce market experienced
strong growth in 2018. According to the E-COMMERCE
IN CHINA 2018, a report
released by the Department of Electronic Commerce and Informatisation of the Ministry
of Commerce of the People’s Republic of China in May 2019, the global online
retail turnover was $2.8 trillion with a year-on-year growth of 23.3 percent.
Comparatively, the global retail turnover in 2018 was $23.9 trillion and the
global online retail turnover rose from 10.2 percent in 2017 to 11.9 percent in
2018. Online retail has gradually become an important channel for global
consumption, and the platform economy represented by e-commerce is sweeping
across the globe, driving an irreversible globalisation trend.

According to
the National Bureau of Statistics of China, China e-commerce turnover reached 31.63 trillion
yuan (about $4.72 trillion) in 2018, and online retail sales surpassed 9
trillion yuan with a year-on-year growth of 23.9 percent. As a
result, China remains the biggest online retail market in the world.
Regionally, e-commerce plays an important role in Hong Kong’s economy. Statista
estimates that e-commerce alone will generate $4,800 million (about 32.2
billion yuan) worth of revenue in Hong Kong in 2019. That figure will increase
with a compound annual growth rate of 7.4 percent from 2019 to 2023, and the
market size will reach $6,400 million (about 43 billion yuan) in 2023. The
e-commerce industry has enormous potential over the next four years.

Meanwhile, Taiwan’s e-commerce market has
grown rapidly in recent years, with users showing strong online consumption
power. Data shows that by February 2018, Taiwan e-commerce industry saw an
average annual growth rate of 7.4 percent in the past seven years, while the
overall retail industry’s annual growth rate is only 1.9 percent. Market
research institute eMarketer anticipates that Taiwan’s e-commerce will be able
to maintain a 7 percent annual growth from 2018 to 2022, indicating there is
still considerable room for growth and development in Taiwan’s e-commerce
market.

Chaos
Behind Prosperity: Frequent E-commerce Fraud Leaves Consumers in Urgent Need of
a Safe Market Environment

As e-commerce and mobile payment have
become increasingly convenient, new fraudulent means are also emerging.
According to a global e-commerce fraud report released by Pymnts.com in October
2017, e-commerce fraud would cause a $58 billion loss in 2017. The “Underground
Industry” behind e-commerce fraud is widespread, affecting numerous links of
e-commerce, including account registration, identity fraud, advertising and
traffic diversion, and loan payments.

According to the latest 2019 Global
Identity and Fraud Report released by Experian, more than 2 in 5 consumers
worldwide have already experienced a fraudulent event online at some point in
their lives, with the highest incidence occurring in the United States and the
lowest in the Europe, Middle East and Africa region. Even the marketplace that
is most effective in mitigating online fraud has potentially left a full third
of its digital customers vulnerable.

According to Experian’s 2019 Global
Identity and Fraud Report (Asia-Pacific Edition), shopping online for goods and services is the most
cited online activity. Fifty percent of businesses surveyed in the Asia-Pacific
region reported an increase in fraud losses over the past 12 months from
account originations and account takeovers – 
both potentially damaging to brand reputation. This is slightly lower
than the global average of 55 percent. Over the past 12 months, 16 percent of
consumers in China reported fraudulent incidents with electronic/mobile
commerce marketplaces, compared with 8 percent in Hong Kong. Consumer
confidence in businesses’ ability to safely confirm their online identity is
moderate. Only 42 percent of consumers indicated that they have complete or
very high confidence, with consumers in Hong Kong and Japan expressing the
least confidence — 21 percent and 13 percent respectively — with Hong Kong
consumers significantly more hesitant to share personal data.

Experian’s
Products and Services Act as “Combined Blows” Against E-commerce Fraud,
Safeguarding the Healthy Development of the Platform Economy

As a leading
global information services
company, Experian is committed to helping businesses combat fraud with new
data and analytical tools. It has invested significantly in optimising existing
anti-fraud solutions and enabling automated decisioning to successfully
identify varied online fraud in an increasingly competitive market and win
customers’ trust. Among Experian’s products and services, solutions like FraudNet, Hunter and CrossCore™ can help prevent fraud and
provide real-time fraud prevention advice in every stage of a customer’s
lifecycle, including account application and opening, identity theft and
transaction fraud, offering consumers and businesses across all industries
multi-protection against e-commerce fraud.

With the
increasing frequency of e-commerce transactions, fraudsters and gangs are
constantly updating and evolving their tricks. Online fraud works to
exploit the weak links and loopholes of digitalisation, while remaining hidden.
These organisations often disguise themselves as most valuable customers before
jeopardizing legal accounts. To catch a criminal, you have to think like one.

Considering this, Experian developed
FraudNet, a fraud detection solution that quickly tracks trusted customers. It
is specially designed for banks, retailers, financial institutions or any
businesses dependent on digital channels for customer acquisition and
transactions. FraudNet recognises consumers through understanding their digital
device interactions across multiple channels. As a scalable, risk assessment
and intervention solution, it identifies every device visiting to highlight
fraud indicators including inconsistencies and transaction volume and velocity
from a single device. As such, FraudNet is cost-effective for reducing fraud
and allowing legitimate transactions.

For any organisation that deals with
application fraud data across multiple channels, Hunter, another solution
developed by Experian, can protect customers against fraudsters and identity
theft. The first and best strategy to reduce fraud losses is prevention,
identifying and stopping fraudsters at the point of application. Using proven
detection rules, Hunter screens for, and highlights potentially fraudulent
applications, enabling fraudsters to be stropped before they become a customer,
increasing fraud savings and assisting in management and control of bad debt.

Experian also designed CrossCore™, the first smart, open,
plug-and-play platform for fraud and identity services to help businesses cope
with the ever-changing, complex and challenging world of fraud prevention. It combines API with powerful workflow and
decisioning functions while supporting a best-in-class approach to managing a
portfolio of services that work together in any combination — including
Experian solutions, third-party services and client systems. CrossCore™ allows you to connect,
access, and orchestrate decisions across multiple systems more effectively with
an open platform, delivering both visibility and agility.

As fraud has become increasingly frequent,
Experian is committed to deploying advanced technology and providing solutions
for businesses. While protecting consumer’s information security, Experian can
reduce misjudgment rate, improve customer experience and increase turnover for
clients. Compared with its peers, most of whom adopt third-party solutions,
Experian can self-develop technology with local teams to provide customised
real-time services. Besides, thanks to its strong research and development
ability and rich international experiences accumulated in the industry,
Experian can effectively update its technologies and products according to
changes in fraud. While expanding its business in the Chinese market, Experian
is making constant efforts in accelerating Chinese e-commerce industry’s
transformation to the path of high-quality development. Together with China’s
e-commerce industry, Experian is committed to further safeguarding and
promoting the development quality of China’s platform economy.