Monica Dishes Up Some Insight on the Delivery App Market for PaymentsSource
Chargebacks911® COO Monica Eaton, one of the world’s leading experts on chargebacks and fraud, applied her knowledge to one of the digital market’s fastest-growing verticals. In her monthly feature for PaymentsSource, Monica comments on the massive surge in fraud activity in the food and beverage industry in the last three years.
The food and beverage industry is seeing massive and rapid transformation. Delivery apps like Grubhub and Uber Eats are transforming the market and consumer behavior. In all, food delivery sales in the US reached $34 billion in 2018, a 13% YoY increase.
As Monica points out, though, the growth in food delivery apps also created a receptive climate for fraud.
2018 saw a shocking 79% increase in fraud activity, and a 170% increase in policy abuse. “Not to sound alarmist, but here’s the simple truth: Fraudsters will continue avidly targeting online food ordering,” Monica says. “Not only that, but the problem is going to get worse before it gets better.”
Fraud and abuse are growing fast. The problem lies in the fact that the food and beverage industry has unique challenges with which other merchants don’t need to contend.
“[Food and beverage] Merchants are under immense pressure to accurately deliver a quality product in as little time as possible. All merchants experience this, but it’s acute in the food industry, where fulfillment is judged on a scale of minutes, not hours or days. The result is merchants can be incentivized to overlook due diligence in fraud detection.”
