Not everything is trending downward for online merchants, according to electronic payments firm CyberSource. E-tailers say they expect to suffer a record $4 billion in fraud losses for 2008, up from $3.7 billion in 2007.

Those increases came despite improved vigilance and growing use of automated anti-fraud tools. The survey shows a reduced rejection rate of 2.9 percent of online orders halted due to suspected fraud, compared to 4 percent last year. E-commerce merchants say they will still lose 1.4 percent of their revenues to fraud, in a fairly steady rate for the past several years.

Only about half of all fraud is detected by chargebacks and customer disputes.

The survey also found 87 percent of companies aren’t likely to add staff to handle increased scrutiny of orders, which are surprisingly labor intensive: CyberSource’s poll found that one in four orders is manually reviewed.

“Losing on average about 1.4 percent of sales to fraud has been the constant,” says Doug Schwegman, CyberSource director of market and customer intelligence. “This year, however, for the first time, merchants could not rely on double-digit market expansion to bolster online revenue growth or to cover inefficiencies. In two key areas–lower order rejection rate and higher interest in automated tools–merchants seem to be managing more aggressively in a challenging economy.”

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