SMB

Holidays mean more business and more fraud for SMBs

  • While many small businesses depend on the holiday season for their revenue, it is also the time when B2B payments experience an increase in fraudulent activity.
  • Businesses cannot afford to back off holiday season sales, but to meet this demand they have to increase B2B activities like restocking inventory, which exposes them to the fraud in the space. 
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Holidays mean more business and more fraud for SMBs

While many small businesses depend on the holiday season for their revenue, it is also the time when B2B payments experience an increase in fraudulent activity. 75% of business leaders report that they are more concerned with fraud during this season, according to recent data

This situation is made more complicated due to the increase in B2B payments during the holiday season. The volume of payments, as well as an increase in workloads, allow more fraud attempts to slip through the cracks than normal. 

The importance of the holiday season for SMBs

Half  of SMBs see 25% of their annual sales during the holiday season, especially in the retail sector, according to recent data. This puts businesses in a double bind: businesses cannot afford to back off holiday season sales, but to meet this demand they have to increase B2B activities like restocking inventory, which exposes them to the fraud in the space. 

Forms of attack

During the holidays, attacks based on compromised business emails are the most common. In this form of phishing attack, bad actors attempt to trick senior executives and key employees into transferring funds and revealing sensitive information about the business. But this form of attack is by no means the only tactic that criminals employ. Other common tactics include phishing, spoofing, and executive impersonation. The data also shows that businesses could be experiencing multiple forms of attack at once. 

Bar chart showing which fraud schemes and cyberattacks are most frequent observed by SMBs during the holiday season. All types of fraud schemes and attacks are at or above 30% with Business Email Compromise, and Phishing amongst the most common (above 40%).
Source: Trustmi

To combat the increased frequency of attacks during the season, 70% of businesses report employing additional security measures to safeguard their vendor and supplier payments. Moreover, businesses undertake employee training and payment verification to decrease the likelihood of successful fraud attempts. 

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