What Is eCommerce Fraud Prevention Software?
Ecommerce fraud prevention software allows online stores to automatically accept or decline payments to mitigate the risk of chargebacks and other types of fraud.
The software runs in the background as customers visit the eshop, browse products, create accounts, log in, make purchases, enter their details, and so on. There are different touchpoints, and not all fraud prevention software covers every touchpoint. To be better protected, you will want to address as many as possible, and do so with minimal disruption to your customers’ shopping journeys.
List of eCommerce Fraud Prevention Software Tools
SEON
From transaction fraud to return fraud and even triangulation fraud, there’s little you can’t control with SEON. The key is leveraging alternative data and dynamic friction to reduce fraud rates without slowing the purchase journey.
What it offers:
- End-to-end fraud and money laundering prevention across the full customer journey, on custom-built technology that unifies fraud and compliance teams.
- 900+ first-party data signals, device intelligence, IP and BIN lookups, card checks, and AML sources, all in real time.
- Transparent, AI-driven insights combining blackbox algorithms with whitebox, human-readable rules so you can see and adjust the detection logic.
- Fully customisable risk rules and a single-API integration, plus an automated chargeback solution.
Best for: Online retailers and marketplaces that want end-to-end fraud plus AML coverage with transparent, adjustable rules.
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Signifyd
Founded by Rajesh Ramanand and Michael Liberty, who met at PayPal. The technology splits into two components: the Commerce Protection Platform and the Payment Optimisation Platform. The latter has four modules: the Console (main interface), Decision Center (shop policies), Insights Reporting (transaction data), and the Onboarding Hub.
What it offers:
- A chargeback guarantee that reimburses losses on approved orders later found to be fraudulent.
- Automated order review and transaction scoring.
- Integrations with major ecommerce platforms.
Best for: Retailers that want chargeback liability shifted to the vendor.
Kount
Kount operates the Identity Trust Global Network, which it reports holds 23 billion data points across 250 countries and 75 industries collected over 13 years. Key products include Command (end-to-end CNP), Central (for payment service providers), and Control (account takeover protection). Customers include PetSmart, Staples, Barclays, and Chase.
What it offers:
- An identity network used for cross-merchant risk signals.
- Machine-learning scoring with customisable business rules.
- Integrations with payment processors.
Best for: Enterprise and mid-market retailers needing scalable detection and analytics.
Sift
Sift is a fraud prevention vendor focused on the card-not-present space, using machine learning and a cross-customer data network to score transactions and account activity. Its main products are the Digital Trust and Safety Suite, Account Defense for account takeover, Payment Protection, and Dispute Management for chargebacks.
What it offers:
- A cross-customer network used for transaction scoring.
- Dispute management and chargeback tooling.
- Coverage across payments, accounts, and other interactions.
Best for: Ecommerce brands wanting one vendor across payments and accounts.
Cybersource
Acquired by Visa in 2010 for around $2 billion, Cybersource combines payment acceptance, fraud management, and transaction security in a single platform. Its Decision Manager screens transactions using rules and machine learning that draw on Visa’s transaction data, and it connects to a broad range of global payment processors and gateways.
What it offers:
- Payment acceptance and fraud management on a single platform.
- Decision Manager fraud screening that draws on Visa’s transaction data.
- Global processor and gateway connectivity.
Best for: Merchants consolidating payments and fraud management in one stack.
Arkose Labs
Arkose Labs was founded in 2015 by Kevin Gosschalk and Matthew Ford, applying machine vision and game-development experience to fraud detection. It focuses on automated and human-driven abuse, pairing device intelligence with adaptive step-up challenges to block bots, fake account creation, and credential stuffing without adding friction for legitimate users.
What it offers:
- Bot, fake-account, and credential-stuffing detection.
- Adaptive step-up challenges presented to suspected attackers.
- Device intelligence with visual authentication flows.
Best for: Platforms dealing with large-scale automation or fake-account creation.
Covery
Covery is a Maltese company that combines fraud prevention with compliance tooling in a single platform. It offers risk analysis, chargeback prevention, anti-money laundering (AML), and politically exposed person (PEP) screening, using device fingerprinting and reputation data to score risk across the customer lifecycle.
What it offers:
- Risk scoring across the customer lifecycle.
- Chargeback prevention plus AML and PEP screening.
- Device fingerprinting and reputation data.
Best for: Businesses wanting fraud prevention with built-in AML and PEP checks.
Ekata
Ekata, now part of Mastercard, is an identity verification and fraud prevention platform for ecommerce, financial services, and payments. It is used to verify customer identities, support onboarding, and inform fraud decisions, drawing risk signals from a global identity network and Mastercard’s transaction data to assess whether a customer is who they claim to be.
What it offers:
- Identity verification using identity network data.
- Risk signals for onboarding and transactions.
- Models that draw on Mastercard transaction data.
Best for: Businesses prioritising identity verification at onboarding and checkout.
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Why Invest in Extra Ecommerce Fraud Prevention Software?
Juniper Research forecasts a loss of $50.5 billion to ecommerce fraud by 2024. Every projection and all available data agree that ecommerce companies of all sizes are routine targets for fraudsters these days. Even when criminals aren’t looking to defraud you but instead use a stolen card, it’s still merchants who bear the brunt of it, through chargeback requests from legitimate cardholders.
Ecommerce fraud prevention is the solution, thanks to a handful of ways in which the technology can help:
- Reduce costs and resources lost to fraud: Having the proper risk management solutions in place can help save on lost items, chargeback fees, and support time dealing with defrauded customers. That’s not to mention return fraud, triangulation fraud, and other tactics that could damage your profits in the long run.
- Maintain a reasonable chargeback rate: Payment processors will avoid working with stores that process too many chargebacks. Your business could also be downgraded to a high-risk merchant category, which will incur extra charges for processing all card payments.
- Secure your customers’ accounts: Whether you operate as an online wallet or not, fraudsters will attempt to log in with existing customer details. They may extract personal information, lock your users out, and make payments that will result in chargeback fees for you.
- Control your brand reputation: If your online store is targeted by fraudsters, you could gain a reputation as an unsafe place to shop and/or amass bad reviews online.
- Improve the efficiency of your manual reviews: While most ecommerce fraud prevention software is designed to automatically approve or decline actions (logins, payments, or signups), the technology can also help your manual review team gain more information to make better-informed decisions. Some retailers even use the tools to check questions coming from support channels to look out for social engineering attacks.
- Improve the user experience: Deploying the right fraud detection solution can accelerate the checkout process. When you have risk scores that clearly show a legitimate user, you can reduce the number of verification steps required for them, which makes buying easier and faster.
How to Choose an eCommerce Fraud Prevention Software
Selecting the right software is a strategic decision that should fit your current needs and scale with growth. Consider how each tool integrates with your operations and what adjustments are needed to maintain efficiency and compliance.
Essential factors to consider:
- Identify your business needs: transaction volume, type of fraud, and compliance requirements all shape the right solution.
- Evaluate features: chargeback management is crucial for saving time and money online.
- Consider user experience: accurate software minimises false positives so you don’t reject legitimate customers.
- Scalability and flexibility: ensure the software scales with your business and adapts to changing fraud patterns.
Choosing the right software means balancing your specific needs with capabilities and cost-effectiveness. Conduct thorough research, use trial periods, and consult vendors to find robust protection that doesn’t compromise customer experience.
FAQs
Combine real-time fraud prevention software with sound policies. The software analyses signals such as device, IP, email, and behaviour at signup, login, and checkout, then approves, declines, or flags actions automatically. Layer in clear refund and return rules, manual review for edge cases, and strong authentication to cut chargebacks without adding friction for genuine buyers.
The most common are card-not-present (CNP) fraud using stolen or synthetic card data, account takeover, and friendly or chargeback fraud where customers dispute valid purchases. Others include refund and return fraud, triangulation fraud, promo and refund abuse, interception fraud, and automated bot attacks that test stolen cards or create fake accounts at scale. You can read more about ecommerce fraud types here.
Investing in ecommerce fraud detection software isn’t just about improving your company’s bottom line. It’s also a competitive advantage to retain a low chargeback rate, as card operators such as Visa or Mastercard could charge you more for payments. Protecting accounts is also key to maintaining a good business reputation.
Sources
- Merchant Savvy: Payment Fraud Statistics
