Small businesses have become increasingly more vulnerable to fraudulent activity over the past five years, with fraud rates continually rising, and spiking during the pandemic as a result of the flood of new businesses to digital tools and increased desperation among fraudsters. Banks have important behind-the-scenes work to continue, but the most overlooked weapon against fraud in small-business banking is the customer-facing digital experience.

In this report, a companion piece to Three Priorities for Countering Fraud Against Small Businesses, Javelin outlines why small businesses are uniquely susceptible to fraudulent activity, and provides a detailed framework for how banks can deputize their business-owner customers against fraud through a Security Hub approach in online and mobile banking.

The behavioral and attitudinal data in this report was collected from a random-sample survey conducted in June 2021 of 900 business owners and decision-makers with annual company revenue between $100,000 and $10 million.

Past data was derived from the following sources:

• A random-sample survey of 900 business owners and decision-makers conducted in three separate cohorts in March, April, and May 2020
• A random-sample survey of 1,000 business owners and decision-makers conducted in June 2019
• A random-sample survey of 1,000 business owners and decision-makers conducted in May 2018
• A random-sample survey of 1,000 business owners and decision-makers conducted in May 2017
• A random-sample survey of 1,000 business owners and decision-makers conducted in April 2016