What is friendly fraud and how do you prevent it?

Friendly fraud, also known as first-party fraud or chargeback fraud, is one of the biggest threats to businesses in terms of fraud. Not only because of the increase in the past years but also because of the negative impact chargebacks have on revenue. Friendly fraud is increasing 20% per year and taking $4 billion in revenue from businesses around the globe. 

Friendly fraud is when a customer purchases a product or service and later claims it’s fraudulent or unauthorized even though it wasn’t. The main difference between friendly and traditional fraud is that friendly fraud often isn’t intentional.

Eliminating friendly fraud can be challenging as it’s difficult to prove the customer did it with the intent to commit fraud. However, you can reduce its impact and protect your revenue with the right tools and necessary actions.

In this blog post, you'll discover:

• What is friendly fraud?

• Friendly fraud vs. chargebacks

• Types of friendly fraud

• Friendly fraud consequences

• How to prevent friendly fraud