Three MRC Vegas 2023 Top Takeaways

Three things we saw

The surge of online sales we saw from three years of pandemic-era ecommerce growth does not appear to be slowing, and retail e-commerce sales are predicted to exceed $8 trillion by 2026, and then rise another 10% by next year.¹

However, macro-economic uncertainty over the past year has presented new challenges for merchants in the months ahead, with rising interest rates and high inflation leading business to make managing costs a top priority. Merchants are now looking for new ways to optimize their payments stack and reduce transaction expense. Economic pressures also lend a greater urgency to tackling fraud and chargeback losses.

Against this backdrop, we spotted three key trends at MRC Vegas 2023:

1. Payments orchestration continues to garner a lot of attention in the industry, especially from larger merchants looking for new opportunities by expanding into more markets. Orchestration can help simplify the integration between a merchant and their payment service providers, automatically selecting the best route to complete a transaction, potentially leading to reduced failure rates and an improved end customer experience.
2. Fraudster innovation continues to pose a serious challenge for merchants. Attendees at the show were particularly alarmed by the potential for highly accessible large language model (LLM) systems like ChatGPT that could supercharge scams or other malicious attacks. One area that experts have already flagged is in phishing or impersonation attempts designed to harvest account log-ins and personal information. This data can be used for account takeover, new account fraud, and other scenarios. In the hands of fraudsters, LLMs could produce highly convincing malicious content and even large-scale automated campaigns in multiple languages.
3. Fraudsters are looking for new opportunities not only by turning to innovative new technologies but also by searching for new environments to exploit in the increasingly omnichannel commerce world. One example is digital marketplaces which have seen significant growth in recent years. As more users and merchants flock to these platforms, the risk of fraud may grow, and with it the need for more effective holistic fraud prevention solutions.

Three things we wish we had seen

We really enjoyed the discussions, panels, and happen-stance interactions that an event like MRC Vegas 2023 can bring. We’d love to see some of these topics explored in more depth next year:

1. Clarity on payments orchestration: While there’s plenty of buzz about the space now, there’s also some confusion we noticed from merchants at the event. Vendors tend to define orchestration in their own and often differing ways, which can lead to uncertainty among merchants. While understandable given it’s a fast-emerging corner of the market, we need to arrive at some better defined terminology if we want to see large-scale adoption.
2. Tackling the low-hanging fruit: While scammers are often quick to leverage the latest tooling and tactics in their campaigns, it can be unhelpful for merchants to focus too heavily on the new. We should also recognize that “tried-and-true” practices continue to bear fruit for online criminals. Data breaches and basic phishing tactics may play a role in fueling the fraud epidemic. So while we need to keep looking toward the future, it's important that the industry also works on solving today’s challenges.
3. Making the most of current tools: As sustainable growth becomes a critical priority for many businesses, it’s worth remembering that merchants can save on transaction-related expenses by leveraging tools and services already available to them today. For example, by leveraging network tokenization, which can help reduce risk at checkout and enhance the customer experience. As an added benefit, using tokens may reduce interchange costs in many regions.

To find out more about what PayPal is doing to help customers better manage fraud risk and minimize transaction costs, please visit https://www.paypal.com/us/enterprise/accept-payments.