Those involved in commercial and enterprise payments have looked to the immediate future, and the view is not encouraging. Fraud, always a concern, is on the rise, and businesses expect it to keep increasing over the coming year.
Albert Bodine, the Director of the Javelin Strategy & Research Commercial and Enterprise Payments practice, just released a report titled Commercial and Enterprise Payments Fraud: 2023 Edition, which offers a comprehensive look at the fraud landscape in commercial payments and an assessment of the technological solutions that stand ready to help companies cope.
Bodine fielded a few questions about what’s happening now and how companies can get ahead of the fraudsters.
What’s behind the rise in fraud in commercial and enterprise payments and why are companies bracing for even more of it in the coming year?
Payments are becoming more digitized, the sophistication of fraudsters is becoming more advanced, and the ability of corporates to keep pace has been challenging. Keep in mind that corporate payments also creep into the world of cross-border, which extends the know-your-customer effort even further for already-stressed corporate security departments.
Fraud, whatever the type, seems almost like a chronic condition. Sometimes, it’s on a low ebb, and sometimes it flares. Why do you suppose this is?
Fraud is all based on opportunity. In the case of corporate payments, the fraudsters are seeing much of the security effort focused on consumers, and thus there’s an opening in the enterprise payments world. Fraudsters are very good at pivoting, so corporates need to be somewhat prescient in their strategies.
You prescribe technology and training for companies that want to proactively mitigate against fraud. What are the larger considerations as they implement a strategy?
Weave fraud prevention into the culture of the organization. Reward those that uncover fraud. Too often, fraud prevention encompasses no more than a compulsory yearly training video and a periodic fake email from the security staff. Hire outside organizations to stress-test your procedures and think like the cybercriminals when developing prevention approaches. Also, know your employees and understand the tendencies for occupational fraud.
What are the risks of standing still?
Cold hard losses. Criminals get fined, but stolen funds are rarely ever fully recovered.
Anything else you’d like to share?
There are many great third-party organizations that are hyper-focused on security strategies for the corporate payments sector. Look to partner with these organizations en route to bolstering your security infrastructure.
If you would like to talk further with Bodine about this topic or commercial and enterprise payments in general, or if you have interest in expertise across a wide range of practice areas, Javelin offers subscription advisory services, consulting and custom research, benchmarking, research reports, webinars, and more. Learn more and reach out here.