iDenfy, a global identity verification and fraud prevention company, recently launched its new fraud-triggered Shopify ID Verification app, designed to help e-commerce merchants reduce chargebacks and risks linked to high-risk orders. The new Shopify app integrates directly with Shopify’s built-in fraud analysis system and automatically initiates identity verification for suspicious orders that are marked as “high-risk, enabling merchants to prevent fraud without disrupting legitimate customer purchasing journeys.
According to recent e-commerce trends, digital identity fraud remains one of the fastest-growing threats in the industry. iDenfy’s CEO, Domantas Ciulde, has been in the fraud prevention sector for eight years now, observing the rise of new types of fraud, which are constantly evolving: “We use AI to automate our solutions and create industry-specific integrations that solve real issues, like our Shopify verification app. However, it’s vital to adapt and constantly improve each element; otherwise, fraudsters are going to bypass the system.”
Over the past decade, rapid growth in global e-commerce has been valued at more than $4 trillion dollars. In 2024 alone, losses from online payment fraud were estimated at $44 billion dollars worldwide. Suppliers of various goods continue to lose billions each year, particularly due to payment fraud and identity misuse, with chargeback fraud among the most common attack methods. Stolen credit card data, synthetic identities, and account takeovers are frequently used to place online orders that appear legitimate.
As e-commerce product purchase volumes rise, business owners face pressure to verify buyers effectively to be sure that they can sell their products to the right audience without any special financial loss. By leveraging AI and machine learning to assess risk variables, including address mismatches, wrong CVV codes, numerous card tries, and odd purchase behavior, Shopify’s fraud evaluation system plays a vital part in recognizing suspicious transactions with risk classification, such as low, medium, or high, on orders to alert merchants about the potential fraud.
It’s important to keep in mind that Shopify does not immediately prohibit or verify these transactions. The seller obtains the final note, which often results in manual assessments, delayed fulfillment, or hefty chargebacks. Ultimately, iDenfy’s new no-code Shopify identity verification app bridges this gap by turning risk signals into automated action. When an order is flagged as medium or high risk, the plugin redirects the buyer into a complete but quick identity verification process through iDenfy’s KYC flow. This eliminates manual follow-ups and reduces operational overhead, while allowing genuine customers to complete verification in less than one minute on average.
“Shopify already does an excellent job identifying risk, but identity verification is the missing layer. With our new Shopify plugin, we help merchants turn fraud signals into real protection, reducing chargebacks while preserving a smooth buying experience,” explained Ciulde.
The solution uses risk-based factors such as IP address of the country, identity documents, or special information that is required to fill in, giving merchants full control over when verification is triggered. Businesses can initiate KYC based on order risk level, pending risk status, specific products, collections, or even landing page activity. This flexibility allows e-commerce businesses to customize fraud prevention regulations and additionally support age verification, which is highly beneficial to firms that must comply with local regulations and sell age-restricted products.
The new app has been built on iDenfy’s global identity verification infrastructure, which includes more than 3000+ recognized identification documents in more than 200+ countries and territories. Passports, ID cards, driver’s licenses, and residency permits are all immediately recognized and validated by the system. Significantly lowering the danger of identity impersonation, biometric face recognition, and 99.9% accurate 3D liveness detection helps to verify if the buyer is physically present and matches the given document.
“As e-commerce fraud becomes more sophisticated, merchants need smarter ways to verify who is really behind a transaction. iDenfy is here to make this process transparent,” added Ciulde.