UK SMEs lose £8 billion to fraud each year

Small retailers face many challenges, including fraud and scams.

If you’re a regular reader of the Integrity Trader blog, you’ll have heard about the types of scams that builders’ merchants and other small retailers are likely to face – including identity fraud. New research by Experian has found that fraud costs UK small businesses approximately £8 billion a year.

10% of micro-businesses (companies with less than 10 employees) report being victims of fraud, and over a quarter of SMEs with 10 or more employees say they have encountered fraudulent activity that’s affected the business. Overall, 13% of the 500 respondents reported that they’d been the victim of a card, cheque or identity fraud.

The cost of each individual instance of fraud varied significantly, but the average amount of money lost to fraud was £2,627, with only 1% of instances costing the business more than £10,000.

Managing director of Experian’s SME business, Ade Potts, commented on the findings: ‘the smallest of businesses in the UK are just as likely to become victims of fraud as their larger counterparts. No matter the size of the loss, whether it is £1,000 or £10,000, it can have a big impact on an SME – both financially and operationally.’

It’s important that retailers and merchants keep a close eye on their balance sheets to investigate any suspicious payments. Retail and point-of-sale software helps you keep your finances in order and enables you to identify potential instances of fraud and scams far more easily than paper-based systems. Get in touch to learn more.