Fraud prevention in European e-commerce

E-commerce fraud continues to rise across Europe in 2025. Criminals are exploiting real-time payment rails, social engineering, and identity theft at greater scale. Authorized push payment scams are growing quickly, and deepfake impersonation is becoming harder to detect.

Merchants cannot rely on generic global tips. Europe has its own regulatory structures, from PSD2 to GDPR, and soon PSD3. The European Payments Council and the Euro Retail Payments Board have both flagged fraud as one of the region’s top challenges. Fraud prevention here requires approaches that address regional realities, shared data responsibilities, and orchestration across multiple providers.

This article examines the current fraud landscape in European e-commerce and offers strategies tailored for merchants operating in this region.

Fraud landscape in Europe today

Rising threat levels

Reports across 2024 and 2025 show fraud levels climbing. Social engineering scams account for a large share of losses. Investment scams and impersonation schemes have surged. Criminals are targeting merchants that support instant transfers, where settlement happens before checks can flag issues.

Authorized push payment fraud is now one of the fastest-growing categories. In the UK alone, more than £450 million in losses were reported in 2023. Across Europe, merchants are facing similar scams, where customers are tricked into sending money directly to fraudsters.

Collaboration on fraud data

The European Payments Council has introduced the Fraud Information and Data Sharing Task Force (FRIDA TF). This group works to enable data sharing across PSPs and banks. The goal is to create early warning systems that can stop fraud faster. For merchants, this signals a shift: fraud prevention is moving toward shared responsibility and real-time intelligence.

Regulatory push

The Euro Retail Payments Board has recommended EU-wide fraud data collaboration and new liability frameworks. Member states are strengthening national rules too. In Germany, BaFin is pressing platforms to improve real-time fraud checks. In France, the ACPR has placed stronger obligations on marketplaces. In the UK, merchants are facing liability shifts under the Economic Crime Act if they fail to implement reasonable fraud prevention.

Merchants expanding across Europe cannot ignore these changes. Fraud protection now ties directly to compliance.

Why generic fraud tips don’t work in Europe

Many global fraud prevention guides repeat the same advice: use rule-based filters, run manual reviews, and monitor transactions for anomalies. These practices are useful, but they are not enough in Europe.

European e-commerce operates under unique pressures:

• Real-time rails like SEPA Instant require fraud checks within seconds. Delays are not an option.
• Multi-country compliance adds complexity. GDPR governs data, PSD2 and soon PSD3 govern authentication, and AML rules vary across borders.
• Shared liability is increasing. In some jurisdictions, merchants may be responsible if regulators decide fraud controls were insufficient.
  

A fraud prevention strategy in Europe must be multi-layered, real-time, and built on orchestration.

Key fraud types affecting European merchants

1. Social engineering: Customers manipulated into making payments. Often linked to push-payment scams.
2. Identity theft and account takeover: Criminals use stolen credentials to access customer accounts and complete purchases.
3. Synthetic identities: Fraudsters create fake but plausible identities, often combining real and fabricated data.
4. Bot-driven attacks: Automated attempts to test stolen cards or exploit checkout flows.
5. Refund fraud: Customers falsely claim goods were not received or returned.
6. Deepfake impersonation: Fraudsters use AI tools to mimic voices or identities, particularly in B2B payment requests.

Each of these requires defenses that go beyond static rules. Merchants must integrate AI-based detection, real-time monitoring, and cross-provider collaboration.

Toward high-impact, Europe-specific strategies

Fraud prevention for European e-commerce in 2025 is about adapting to these realities. Strategies must integrate regulatory requirements, leverage orchestration, and use advanced tools like machine learning.

The next part of this article will explore seven high-impact strategies for merchants, explain how orchestration supports fraud prevention, and provide a practical roadmap for building a European fraud defense framework.

High impact strategies suited to Europe

Fraud prevention in 2025 requires region-specific measures. These strategies reflect regulatory changes, consumer habits, and merchant realities:

1. Real-time fraud checks with verification of payee: Instant payment adoption means fraud must be detected in seconds. Verification of payee ensures the account details match the intended recipient, reducing spoofing and liability. See our analysis of real-time payments across Europe for more on instant settlement and fraud risks.
   
2. Cross-provider fraud intelligence: Fraud data sharing is becoming essential. Merchants can strengthen defenses by working with providers and orchestration platforms that support intelligence exchange. Broader trends are covered in European retail payment trends in 2025.
   
3. AI and adaptive risk scoring: Fraud tactics evolve quickly. Machine learning and behavioral analytics help merchants spot anomalies without increasing false declines. When connected through orchestration, these tools scale across all providers.
   
4. Enhanced risk policies for merchants: Regulators expect merchants to implement stronger internal controls. Fraud prevention is no longer limited to banks or PSPs. Platforms and marketplaces must embed compliance frameworks as explained in embedded payments compliance in Europe.
   
5. Behavioral and device intelligence: Device fingerprinting and velocity checks help identify bot attacks, account takeovers, and organized fraud. Merchants operating across borders can use orchestration to apply consistent device rules across acquirers.
   
6. Chargeback and friendly fraud defense: Disputes and refund abuse remain common. Orchestration enables merchants to track data across providers, making it easier to respond to chargebacks and reduce losses. For more on regional payment habits and dispute patterns, see top payment methods in Europe.
   

How orchestration strengthens fraud defenses

Payment orchestration provides a foundation to make these strategies effective:

• Unified fraud stack: Centralizes fraud tools, rules, and monitoring in one control layer.
• Adaptive routing: Routes higher-risk transactions through stricter fraud engines or preferred acquirers.
• Analytics and reporting: Gives merchants visibility into fraud trends across all PSPs and markets.
• Resilience: Keeps checkout operational even if fraud-related issues hit one PSP.
  

These capabilities highlight why orchestration is a stronger model than relying on one PSP. For more on this, see our guide on payment orchestration vs PSP in Europe.

Roadmap for merchants

A fraud strategy in Europe should follow these steps:

• Assess risk country by country: Fraud patterns differ across markets. Data in our 50 payment and merchant statistics provides benchmarks.
• Adopt orchestration: Use a control layer to unify fraud defenses across PSPs.
• Layer protections: Combine AI, device intelligence, payee verification, and manual reviews.
• Collaborate on data: Work with providers that support fraud intelligence exchange.
• Embed governance: Train staff, document fraud frameworks, and include fraud metrics in compliance reviews.

FAQ

What types of fraud are growing fastest in Europe?

Social engineering, authorized push payment scams, account takeovers, and refund fraud are on the rise, especially where instant payments are active.

How does verification of payee reduce fraud?

It checks the account name against the IBAN to prevent misdirected transfers and scams in instant payment flows.

Are merchants liable for fraud prevention gaps?

Yes. Regulators are increasingly holding merchants accountable when internal fraud controls are weak, especially in embedded or marketplace payments.

How does AI improve fraud detection?

AI adapts to evolving patterns and reduces false positives, allowing merchants to block fraud without harming genuine customers.

Does orchestration help beyond cost savings?

Yes. Orchestration provides fraud resilience, centralizes compliance, and enables merchants to apply consistent defenses across markets.

Fraud in European e-commerce is evolving fast. Real-time payments, new scams, and shifting regulations require merchants to strengthen defenses. Generic fraud tips are not enough.

Merchants need layered protections, real-time verification, and orchestration to stay ahead. By centralizing fraud prevention across providers, orchestration makes compliance easier, improves resilience, and protects revenue.

Contact Gr4vy to develop a tailored fraud prevention strategy that aligns with the scale and complexity of European e-commerce.