Fraud rate

A measure of the prevalence of deceitful activities, like shadows lurking in the corners of commerce, calculated as the ratio of fraudulent transactions to the total number of transactions during a specific period.

Example

If an online retailer processes 10,000 transactions in a month and identifies 50 of those transactions as fraudulent, the fraud rate would be calculated as 50 / 10,000 = 0.005 or 0.5%. This percentage helps the retailer evaluate the effectiveness of its fraud prevention measures and identify areas for improvement. A high fraud rate may indicate the need for more robust security measures or improved transaction monitoring.