Merchants Turn to Technology as Fraud Prevention Moves Beyond Checkout

By Staff, Agencies

Merchants are increasingly shifting how they fight fraud, relying less on large teams of staff and more on technology that can monitor risks throughout the entire payment process.

A new report by PYMNTS Intelligence, titled “Orchestrating Trust: The Future of Fraud Prevention in Payments,” says fraud prevention is no longer just about stopping criminals at the checkout page. Instead, businesses are focusing on managing risk from the moment a customer creates an account through to payment and even after a transaction is completed.

The report explains that many companies are adopting what is known as “fraud orchestration.” In simple terms, this means using a central system that brings together different security checks—such as identity verification, customer behavior tracking, and automated decision tools—to assess risk in real time. The aim is not only to block fraud, but also to avoid frustrating legitimate customers.

One of the key challenges for merchants is balance. About 85% of businesses surveyed said their biggest problem is stopping fraud without making payments harder for honest shoppers. Heavy-handed security checks can reduce fraud but also drive customers away.

The findings show a clear move toward automation. More than half of US financial institutions already use or plan to use fraud orchestration systems, while 51% of global online merchants expect spending on fraud staff to stay the same or decline, even as fraud threats grow.

Fraud itself has also become more complex. Criminals now use multiple methods at once, including fake accounts, stolen identities, and false refund claims, and they quickly change tactics when blocked. Traditional systems that rely on fixed rules often fail to keep up, while smarter tools work best when they can draw on multiple signals at the same time.

The report also highlights the cost of mistakes. Nearly half of merchants say that up to 5% of legitimate purchases are wrongly declined, costing the industry billions of dollars in lost sales. Newer systems try to reduce this by applying stricter checks only when a transaction looks risky, allowing trusted customers to pay with fewer obstacles.

Another trend is the integration of fraud checks directly into payment platforms. When security decisions and payment processing work together, businesses can improve approval rates while still keeping fraud under control—an important advantage as online payments become faster and more automated.

Finally, the report notes that fraud prevention now extends well beyond the point of sale. Businesses are monitoring account sign-ups, changes to customer details, transactions, and disputes as part of one connected process. This broader approach helps companies spot patterns, reduce costs, and respond more quickly to new threats.

As fraud continues to evolve, the report concludes that relying on single tools or manual processes is no longer enough. For many merchants, smarter and more coordinated technology is becoming the preferred way forward.