Half of eCommerce Merchants Freeze Fraud Staff as Tech Budgets Rise

Global eCommerce merchants are splitting their fraud-prevention budgets in two directions. A majority — 51% — anticipate keeping spending on fraud-management personnel steady or reducing it, while 63% intend to pump more resources into fraud-management platforms and tools.

The divergence underscores how fraud orchestration has become both an operational efficiency lever and a security imperative. Merchants are under growing pressure to rein in the cost of fraud operations even as payment channels multiply and attack vectors grow more sophisticated.

According to Merchant Risk Council figures cited in a recent Spreedly-sponsored report, the proportion of merchants ranking lower fraud-related operating costs as a top priority has doubled year-over-year — jumping from 10% to 20%.

With half of merchants planning to hold the line on fraud staff or shrink those teams, technology will shoulder a greater share of the workload. Automated workflows and machine-learning models are expected to consolidate data streams, cut down on manual review queues, and apply risk-based controls that match each transaction's profile.

On the technology side, spending is heading in the opposite direction. Nearly two-thirds of merchants — 63% — are planning to increase investment in fraud-management technology over the coming year.

The report ties this uptick to platforms that can unify identity verification, behavioral analytics, device fingerprinting, transaction scoring, and payment routing through a single decision layer. By orchestrating these capabilities, merchants aim to scale their defenses without scaling their teams at the same rate.

Adoption of fraud orchestration is already widespread in the financial-services sector. Datos Insights research shows that 53% of U.S. financial institutions currently use fraud orchestration platforms, while another 16% are in the process of deploying them and 26% have adoption on the roadmap.

These platforms integrate APIs, third-party data signals, internal transaction histories, and machine-learning scores into a unified decision engine — reducing the need for teams to manage each integration separately.

Merchants are also working to prevent fraud controls from becoming a revenue drag. Eighty-five percent identify stopping fraud without degrading the customer experience as their most pressing fraud-prevention challenge.

False declines remain a costly problem: nearly half of merchants — 47% — estimate that as much as 5% of legitimate transactions are incorrectly flagged as fraudulent and rejected. Orchestration layers can help by determining when additional verification steps are warranted, when trusted buyers can proceed with minimal friction, and how multiple fraud tools should interact — all without requiring expanded teams to coordinate the logic manually.