Key takeaway: Catching a bad payment before settlement, not disputing it after, is what separates firms paying 21 basis points in fraud costs from those paying double that.
A PYMNTS Intelligence study conducted with Plaid found that 57% of middle-market firms detect payment fraud or failed payments only after settlement, while the minority that catch problems earlier report fraud costs roughly half as high.
The findings come from “Early Detection: Why Top-Performing Firms Focus on Fraud Before It Starts,” the May 2026 edition of PYMNTS Intelligence’s 2026 Certainty Project research series with Plaid, which PYMNTS revisited in a news write-up published September 1, 2026. The study surveyed 60 heads of payments at U.S. companies with $100 million to $1 billion in annual revenue between March 18 and March 30, 2026.
Only 30% of firms catch fraud or payment failures before initiation or during authorization, the study found, while 88% reported at least one accounts-receivable integrity issue in the past year and 70% saw ACH returns tied to invalid accounts, closed accounts, or customer input errors.
The gap shows up in the cost data: firms with high payment uncertainty reported fraud costs averaging 42 basis points of revenue, roughly double the 21 basis points reported by firms with low uncertainty. Firms that said faster payment rails were increasing their fraud exposure reported costs of 41 basis points, 60% higher than other firms, and poorly integrated fraud tools carried costs of 40 basis points versus 30 to 35 basis points for better-integrated systems.
Firms that detect problems earlier lean on different tools: 81% of pre-settlement detectors use instant bank account verification, compared with 47% of firms that catch fraud after settlement, and 76% use open banking-based account ownership checks versus 35% of late detectors. Among companies that recently adopted real-time bank account verification, 84% rated it “very or extremely effective,” the study found.
“Uncertainty can turn a routine payment problem into a cost that is twice as large,” the report found.
Why it matters for merchants: Waiting until after settlement to catch fraud means the money, and the chargeback fight, has already started. The study’s core finding, that early detectors pay roughly half the fraud costs of everyone else, makes the case for treating account verification as a pre-payment check rather than a post-payment cleanup step.
Sources: PYMNTS – “Early Detection” study; PYMNTS – study write-up