Fraud increases customer churn for 63% of respondents and forces businesses to allocate more resources to fraud management. Nearly two-thirds (64%) of respondents said fraud hurts customer conversion rates, pointing to the challenge of balancing strong security with a quality customer experience. 

A significant number of businesses are yet to adopt advanced fraud prevention tools, such as AI models, behavioral biometrics and third-party detection systems. Forty-one percent (41%) of North American merchants still depend on manual processes to prevent fraud, highlighting a widespread reliance on outdated methods.

Additional insights from the report include the following:

The True Cost of Fraud Study by LexisNexis Risk Solutions, conducted by KS&R, surveyed 569 fraud and risk executives across U.S. (487) and Canadian (82) retail and e-commerce companies in late 2024 and early 2025.