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Key Takeaways: Risk and Compliance Benchmarking Report 2023-2024

Key takeaways from LegitScript's Benchmarking Report.

The LegitScript Payments Risk and Compliance Benchmarking Report 2023-2024 provides valuable insights into the state of this dynamic industry. Read further to understand the key takeaways, top-of-mind risk and compliance issues, and more. Then, download the Payments Risk & Compliance Benchmarking Report 2023-2024 for full details.

Key Takeaways From the Benchmarking Report

The benchmarking report highlights several key takeaways that provide a comprehensive understanding of the current state of payments risk and compliance.

Digital Transactions and Online Fraud

Digital transactions and online fraud are growing in tandem. It began as the world shifted online during the COVID-19 pandemic. As more consumers have embraced digital payments, advancing technology such as artificial intelligence has both helped and hindered the space. New technologies help expedite underwriting and onboarding but also enable more fraudulent activities. Companies must be vigilant in implementing robust risk mitigation strategies to protect themselves and their customers.

Shift Toward Card-Not-Present (CNP) Transactions

Companies are experiencing a significant shift in their portfolios toward more merchants conducting card-not-present transactions. This trend aligns with the overall industry shift toward digital payments. It is crucial for companies to adapt their risk and compliance processes to address the specific challenges posed by CNP transactions.

Increase in Survey Participation and Competition

The survey saw an increase in participation from payment facilitators and companies with small portfolios, indicating the growth of new players in the payment processing industry. This can equate to increased competition but also innovative niche services for consumers. Companies must stay ahead of emerging trends and maintain partnerships to stay competitive in the dynamic landscape.

Risk and Compliance Issues Top of Mind

Transaction laundering remains the top concern for payments companies, usually resulting in automatic merchant decline or termination. Ongoing changes to merchant websites and products also pose significant challenges. Payments companies must prioritize effective monitoring and risk mitigation strategies to combat these issues.

Additionally, more companies with smaller portfolios are receiving card brand fines compared to previous years. This highlights the importance of maintaining compliance with card networks and government regulations to avoid costly penalties. Companies should invest in robust compliance analysis and monitoring to mitigate compliance risks.

A significant majority (81%) of survey participants use a merchant monitoring service provider (MMSP) to mitigate risk — the highest percentage in the history of the survey. However, overall satisfaction with MMSPs has dropped, primarily due to the inaccurate data and false positives of some providers. Companies must carefully choose MMSPs that provide accurate and reliable monitoring services to ensure effective risk mitigation.

LegitScript Helps You Grow Your Merchant Portfolio with Confidence

Are you looking to grow your merchant portfolio? Avoid transaction laundering, card brand fines, regulatory scrutiny, and more by partnering with a merchant monitoring service provider like LegitScript.

First download LegitScript's 2023-2024 Benchmarking Report to see how your company stacks up in the industry, and then connect with us to further reduce your risk, improve your processes, and explore growth opportunities.

Smelting words into subject matter expertise since 2020, Thea Le Fevre specializes in B2B SaaS Content Marketing. She believes in embracing innovation and produces AI-assisted content along with organically crafted content. Take a deep dive into her work for up-to-date industry news surrounding issues in trust & safety, payments risk & compliance, healthcare, and more.

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