Chargebacks and Friendly Fraud Soar as Food Delivery and Pick Up Surge - Kount

As published on Card Not Present, April 23rd, 2020

The retail and hospitality sector have been hit hard by stay-at-home orders put in place to control the spread of the novel coronavirus. Eating out and vacations have ground to a halt and some analysts predict traditional brick-and-mortar locations for retailers may not survive the economic downturn.

One bright spot, however, is food pickup and delivery. Forced to stay home, consumers have turned to buying online and picking up food curbside, or to restaurant delivery services like DoorDash and Postmates to get meals brought to their door. A 2019 eMarketer study found 38 million people in the United States used food delivery apps at the time. The same research predicted that the number of users will rise to 44 million in 2020. But, with so many now turning to food apps, that number will probably be even higher this year.

E-commerce fraud prevention firm Kount has been tracking the changes in e-commerce models and consumer demand caused by the pandemic and finds quick service restaurants that offer mobile-order ahead and other ways to order food online are showing significant growth year-over-year in digital channels.

“This industry has seen some impact from business reactions to government mandates, however it appears to be picking back up,” said Rich Stuppy, chief customer experience officer with Kount.

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