Vacation season is approaching fast and people are beginning to book their travel. Many use online travel agencies, while some book their travel directly through an airline and hotel websites. Did you know that just like many other verticals, the travel industry is a huge target for fraud?
Here are some shocking stats about online fraud in the travel industry:
- Overall, travel merchants lose an average of 0.44% of annual revenues to online fraud, according to data compiled by CyberSource.
- 4% of airline bookings are rejected or cancelled due to the suspicion of credit card fraud.
- It is estimated that credit card fraud represents between 1% and 2% of an airline’s revenue in the indirect channel. This presents a $2.4 – 4.8 billion dollar problem for airlines.
- With airlines experiencing fraud attack rates in the 1–3% range, there are carriers that actually reject 8%-25% of good orders (false declines) because their automated fraud screening methods can’t examine bookings with sufficient granularity to accurately interpret whether a booking request is fraudulent or not.
- Javelin reports that the false positive numbers for the CNP channel are staggering. Of that $118B lost to false positives in 2014, 37%, or $43B+, can be attributed to the CNP channel (which eMarketer states it represents 6.6% of total retail sales).
- According to a survey done by CyberSource, the fraudulent booking rate averaged 0.65%, but varied widely by region and years of experience.
- In the same CyberSource survey, it is reported that 26% of online bookings require additional manual review due to suspicion of fraud.
Want to learn more about the travel industry? Download our free Travel Fraud Guide from the button below!
Do you want to be a part of the next statistic or do you want a solution? Find out how to fight fraud in our next blog, or contact Cardinal today. With your One Connection to Cardinal, we can help Drive Digital Commerce to your business!