What is the fraud-sales-ratio?

The fraud-sales ratio measures the extent of fraudulent activity within a given sales context by examining the relationship between total fraudulent sales volume and total interchange sales volume. It is expressed as a percentage, allowing businesses to assess the level of fraud relative to the overall sales transactions that involve interchange. By focusing specifically on interchange sales volume, this metric helps organizations identify patterns and trends in fraud that could be linked to the acceptance and processing of card transactions across different payment networks.

Understanding this ratio is vital for businesses as it can inform risk management strategies and help improve overall payment security practices. It allows organizations to analyze their exposure to fraud and adjust their policies or approaches accordingly.