While theft will always be a problem—whether using physical or digital money—fraud takes on a new dimension when it moves online, with an entire bank account available for emptying rather than a single wallet or register.
A core benefit of cash over other payment options is its safety. Banknotes and coins are a secure way to exchange value, with each party able to see the money transfer in real-time. Security features on cash are also continuously updated, meaning it is easier than ever to be sure of the authenticity of physical money.
With digital payments, the scope for fraud is considerably greater. Street vendors have expressed a preference for cash payments due to the possibilities for faking digital payments (for example taking a screenshot of a genuine transaction, then showing it to a different vendor without having made a payment).
Keeping cash secure is as much a concern as other payment methods, but when banknotes are scooped out of a register, the amount a business is losing is likely to be considerably less than when it suffers digital theft. Juniper Research recently published a study forecasting losses from online payment fraud exceeding $362 billion globally over the next five years, attributing this to a growth in eCommerce in emerging markets and an associated acceleration of fraud.
