09:10 AM EDT, 09/24/2024 (MT Newswires) -- More and more Canadian small businesses are being hit by fraud, with half of them experiencing either attempted or successful fraud in the past 12 months, and 36% of those who fell victim to fraud suffering financial losses, according to new data by the Canadian Federation of Independent Business (CFIB) released Tuesday in collaboration with Interac Corp.

Impacted business owners have lost C$7,800 on average in the past year, said CFIB. Beyond financial losses, small businesses dealt with lost time (76%), negative emotional impact (51%), and decreased staff morale (23%).

"Whether you're a consumer, a mom-and-pop shop or a big industry player, we've all been impacted by fraud in some shape or form. Dealing with their consequences can be frustrating and time-consuming, especially for small business owners who often don't have enough time or resources to address this growing issue," said Corinne Pohlmann, Executive Vice-President of Advocacy at CFIB, in a statement.

The bigger the business, the likelier it is to experience fraud attempts, stated the association. The most common types of fraud attempts include email scams and phishing (85%), text (77%) and phone call scams (76%). Though less common, fraudulent payments and chargebacks -- when a customer falsely disputes legitimate transactions) -- are more likely to result in business losses, for 19% and 16% of businesses respectively.

Businesses in the hospitality, retail, transportation, personal services, and arts, recreation and information sectors were found to be particularly vulnerable to these two types of fraud.

Nine in ten, or 90%, business owners are also worried that the rise in the use of artificial intelligence (AI) will make fraud more sophisticated and harder to detect, added CFIB.