The Problem Of In-App Purchase Fraud In Mobile Gaming

After the pandemic, gaming activity has increased tremendously, and the future seems bright for ambitious game developers. Phonato Studios has discerned that free-to-play mobile gaming apps are having their time under the sun. 


But there is a problem. Freemium games are highly susceptible to in-app purchase scams and fraud, which can lead to monumental losses. This includes the targeted hacking of in-app paid offerings with the goal to use them for free. Given that a considerable chunk of the game’s profits is generated through such purchases, such activities can significantly set game development companies back if left unchecked. Often, independent developers don’t realize the severity of the issue until it’s too late. 


In addition to the financial cost of such hacking attempts, it wreaks havoc on the game’s economics and frustrates genuine users who paid to gain access to your unique offerings. The game’s value decreases in the eyes of the authentic player.

How Does In-App Purchase Fraud Occur?

Fraudsters may employ a wide range of tactics to steal digital assets, such as new weapon skins and special abilities. Here are some of the measures taken by them: 

  • Using rooted devices to fool the app into thinking that they are making a payment through Google Play Store. 
  • Using stolen credit card details to make in-app purchases through guest accounts. Once this is done, the scammer may put the account up for sale, after which the buyer can continue playing by linking it to their own social media accounts. By doing so, scammers can easily use stolen financial details to their benefit without coming under scrutiny.

Stopping In-App Purchase Fraud

The most basic strategy to prevent this menace from eating into your profits is to adopt server-side verification of purchases. You can use this tool to ensure that the client-side gets a receipt, which is then verified by the app store in question. 


While this effectively keeps a significant percentage of fraudsters at bay, it is not foolproof. The right approach would be to monitor your apps for suspicious activities and transactions. Go through your transactions report regularly to check for irregularities. If you notice listed log transactions that never went through, it is a huge red flag that must be addressed immediately. 


With manual intervention, the process of assessing fraud risk becomes time-consuming and prone to mistakes. Given the nature of this task, it makes sense to adopt automation, machine learning, and analytics tools, specifically for the examination of brand new player accounts. These tools will look for patterns and alert you upon noticing anomalies.


As you can see, prevention of in-app purchase fraud is extremely crucial if you want to last in the game development world. In-app purchase fraud not only hurts your chances of monetizing your app, but it also irks the loyal, returning customer as scammers end up gaining an unfair advantage over them. 


Building a game from scratch is a laborious process, and game development companies must be compensated well for their efforts. While tackling fraudulent actors can be challenging, do take additional security measures to ensure that your games aren’t overridden by malicious entities