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Last updated: 10th March, 2021

Online Business Academy

Financial security threats to e-commerce businesses

Financial security threats pose an extremely dangerous problem to e-commerce businesses. They can range from credit card fraud to hackers attempting to take control of your website or crash it entirely. Due to this, understanding what these threats are and how to safeguard your business from them is vital.

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In this article we cover some of the main e-commerce security risks that businesses should watch out for, and some measures you can take to protect yourself:

What is security in e-commerce?

E-commerce security involves putting measures in place, such as cybersecurity installations and programmes, that allow users to buy and sell within a secure framework. The past few years has seen a surge in e-commerce sales, which are projected to reach $4.5 trillion by 2021. This, combined with 50% of small businesses  experiencing more severe and complex attacks on their e-commerce sites, means that having a safe e-commerce marketplace is more important than ever.

Why is e-commerce security important?

The bottom line is that the quality of a company’s e-commerce security can make or break a business. Annually, one in five small e-commerce businesses are victims of fraudsters, and more than 60% of those impacted close within six months. If you owned a physical store you would take the necessary precautions to keep you and your goods safe, such as installing alarms and CCTV cameras, or even hiring security personnel. Your online store should be no different.

If you fail to consistently update and stay on top of your e-commerce security, you could become vulnerable to breaches. These can compromise both your company’s finances and your customers’ sensitive data – which can lead to hefty fines. Falling victim to a data breach leads to a loss of customer trust, damages your brand’s reputation and lessens the likelihood you’ll be recommended to others – which all threaten your business’s chance of success. For more information on how to safely set up your e-commerce business, visit our step-by-step guide.

What are the major threats to e-commerce security?

The list below isn’t an exhaustive list of cybersecurity threats, but these are some of the most common and dangerous threats to e-commerce businesses:


Phishing involves customers being contacted by scammers impersonating your business. The messages or emails contain links that ask for passwords, personal information or payment details, which are then recorded and stolen. It is an extremely common threat, with 76% of businesses having reported being a victim of an attack in the past year.

DDoS attacks

Distributed Denial of Service (DDoS) attacks involve your business being directly targeted by an attempt to overwhelm it with traffic. They are becoming increasingly popular during peak sales times: on Cyber Monday in 2018, e-commerce sites saw a 109% increase in DDoS attacks. The attack will overload your site, making it impossible for customers to access. Not only could this lead to your site crashing and needing maintenance, but as customers are unable to access your store, you will be losing potential sales revenue.


Bots are programmes that perform repetitive tasks, and whilst both good and bad bots exist, it’s the bad bots that we’re worried about here. These malicious bots are often the method used by attackers for scraping, to install malware or trigger phishing campaigns.


Attackers will often attempt to gain access to the code of your website, and if successful, they can insert a line of their own malicious code. This is known as malware, and it will latch onto site visitors and target the personal information and sensitive data on their devices.

Trojan horses

These programmes are used to steal information from the devices of targets when they are unwittingly downloaded under the guise of being another programme, such as ‘computer cleaning software’ or a fake Adobe Flash Player.


If your online store is left vulnerable, known as cross site scripting (XSS), hackers can use cross-site scripting to infect it with malware, allowing them to piggyback other users or steal their details.

SQL injections

These are generally said to be the most common form of cyber-attack today. Hackers will inject malicious code into your website’s query submission forms in order to access the site’s database, or even control your site at will.

Financial fraud

Fraudsters can request fake refunds and returns, when in reality there is no real product to return, or request refunds for stolen or damaged goods. When running your online business and transferring fees to supplies, they may also set up fraudulent payment portals. As these can often be large amounts, you need to be sure your money is being transferred safely.

Brute force attacks

Hackers can attempt to log into your account by using brute force to crack your password. They can use a bot to connect to your website and try every combination of letters, numbers and symbols until they find the right answer.

How can I protect my website from e-commerce security threats?

It may seem like there’s a mountain of serious threats facing your e-business at every turn. Luckily, there are also lots of ways to safely protect your e-commerce site from these risks:

Antivirus and anti-malware software

It may sound obvious, but after being installed these programmes use sophisticated algorithms to monitor transactions. They can also flag any suspicious activity, enabling you to take quick action and ensure all transactions are legitimate.

Use a solid e-commerce platform

Be sure to choose a platform such as PrestaShop, Magento or Shopify, which has regular updates. Updating your store’s software promptly will also help, as these often include security patches, that can help to keep you safe from newly discovered bugs or potential vulnerabilities.

E-commerce security plugin

Security plug-ins, such as Astra, can provide protection against bad bots, SQLi, XSS, code injections and hundreds of other severe attacks. They can automatically secure your site and virtual patch software, preventing malicious requests from ever reaching your website.

Use firewalls

These add protection by allowing you to regulate the type of traffic entering your website. Only trusted traffic will be admitted, keeping threats such as XSS and SQL injections at bay.

Secure admin panels and servers

Avoid using default passwords from e-commerce platforms. Use complex and unique passwords and set your website security up in a way that those attempting to log in from unknown IP addresses, or those using too many incorrect password attempts, are immediately reported.

Use HTTPS protocols

HTTPS is far safer than HTTP as it protects sensitive user information, such as credit card data, entered on your site. Ensure these protocols are consistently updated as most modern browsers can flag insecure websites, prompting potential customers to avoid your site. Adding an SSL certificate will also make your site rank higher on Google, and shows official ownership, making you and your customers less vulnerable to phishing scams.

Payment gateway security

Storing customer credit card numbers on your database is a liability and should be avoided, but if you must do it, obtain Payment Card Industry Data Security Standard (PCI DSS) accreditation. It’s often better to use third-party gateways, such as Stripe or Opayo, which minimises risk.

CVV verification and address verification system

Card Verification Value (CVV) is the three or four-digit code on the back of your credit card. This extra layer of security means that fraudsters who have acquired credit card numbers from victims won’t be able to use them in fraudulent transactions. Address Verification works similarly. If the billing address entered by a customer doesn’t match the one that is on file at the credit card company, the transaction will be flagged as fraudulent.

Back-up data frequently

In the unfortunate scenario that your website is targeted and successfully hacked by attackers, having a recent backup of your important data easily accessible will mean that you’ll be able to get back up and running quickly.

Educate your clients and customers

Ensure that customers can only sign up to your site with strong, complex passwords or offer that they sign up via Facebook or Google, who offer world-leading cybersecurity. Warn them about phishing and inform them that you will never ask them to enter their password over email, and that emails from you will contain a clear signature.

It is often said that people are the weakest link in the chain when it comes to security issues, and encouraging your clients and customers to be vigilant, as well as practising vigilance yourself as a business owner, is of the utmost importance.

The takeaway:

Keeping your business and customers safe online should be a priority when setting up an e-commerce site. It will not only create a more enjoyable and efficient shopping experience, but it also provides customers with peace of mind and security, crucial to the reputation and success of your business.

As well as keeping your customer transactions safe, you should also ensure your own business’ transfers are secure when paying money to suppliers abroad. PagoFX is an international money transfer app service that offers transparent low costs and real-time, mid-market exchange rates (similar to the ones you can find in public sources such as Google). Backed by global bank Santander, PagoFX lets you make international business payments in confidence.  

This article is provided as general information purposes only and is not intended to cover all aspects of the topic. We recommend that you take professional and specialised advice before taking, or refraining from, any action based on the content of this publication, as this article is not intended to constitute expert advice. We do not guarantee, explicitly or implicitly, that the content of this article is accurate, complete or up-to-date. The information in this article does not constitute legal, tax or other professional advice from PagoFX or its affiliates.