Updated: Nov 10, 2020
This blog will touch on fascinating facts about how bad fraud is when accepting card-not-present (CNP)transactions and important steps to take to help prevent it from happening at your place of business. (According to Digital Commerce 360, Shift processing) It's 81% more likely to encounter Card-Not-Present (CNP) fraud than a point of sale fraud which is card-present(CP).
The statistics also show that most credit card fraud occurs in the U.S.
The most popular scams in the U.S. fraudulent weight-loss products.2.6 million people reported buying such products.
50% of e-commerce fraud took place in Delaware, New York,& California. Credit card fraud is expected to have cost the world 30 billion in 2019 with this number set to grow considerably in the following years. Gross losses from credit card fraud are expected to reach 40 billion in 2027.
The average credit card fraud Americans lose is $231.This is less than the average loss from other crimes such as romance scams($6003) or identity theft($683).
Since the COVID Pandemic, these numbers have risen. What are you doing as a business owner to protect your business from being an easy mark from scammers? Unfortunately, there are people out there working hard on taking your money away from you and your family. This is only going to get worse with the economy and unemployment due to COVID.
Let's start with these steps you can take to help prevent you from becoming a mark.
Collect more data
When you take payments, you should require verifying information for the card. This includes the security code on the back of the card, the cardholder billing address, the shipping address, the IP address of the device used to shop, and the cardholder's phone number. The more information you gather, the more certainty you can have in verifying that the person making a purchase is the person who owns the card. Doing this step will also help protect you against chargebacks.
Track shopping patterns
With all of the technology, businesses are using like CRMs, building a customer profile will help you keep notes and help track your customers that are reoccurring, patterns in their shopping. How often they purchase, how large their purchases tend to be when they tend to purchase. This doesn't mean that if an existing customer breaks their purchasing behavior, you deny the transaction. Rather, it should raise extra scrutiny on such purchases, and to be safe take extra measures you have in place to confirm the transaction is legit.
Request extra authentication
Trust your gut feeling when a customer is running a large ticket transaction or maybe they want the goods to be sent to a different address from the card hoders home address. If it doesn't feel right, ask for the card holders phone number and call them to verify the transaction. This will not fully prevent fraud, however a lot of times this alone will make fraudsters feel uneasy and generally they will abort or abandon the cart. You can always count on us to assist with these types of situations. We will call the card holder together to verify certain info to ensure its not fraud. This is one of the major benefits of having a dedicated relationship manager on the merchant account.
Tokeniztion is a must
Tokenization is the process of protecting sensitive data by replacing it with a unique identification symbol or token that retains all the essential data without compromising its security. It is very useful for processing card-not-present transactions safely & securely, reducing the risk of having sensitive data fall into the wrong hands. An easier way to understand this is, when going o chucky cheese and you want to play with the games. You must buy tokens in order to play. These token are only good for chucky cheese. Same thing when we tokenize your transaction at your business those tokens would only be good for your establishment. This means if you were to be compromised, the tokens would do a fraudster no good because they are only good for your establishment.
PCI compliance, believe it or not is more than just an unnecessary fee on your statement. This is something that should be taken seriously. Payment Card Industry (PCI) are the rules and regulations that the card brands have set in how businesses capture credit card information from cardholders. Every merchant must be PCI compliant. The PCI compliance involves a SAQ that merchants must take online and answer a series of questions such as the type of equipment you use when running credit card transactions and other questions like making sure you don't write credit card numbers down on paper and leave on you desk where other employees might be able to take. The consequences of not being PCI compliant generally result in a non-complaint fee. Depending on the type of equipment you use for instance if a terminal is no longer considered PCI compliant by card brand standards a merchant service company will no longer be able to support such models in assisting with service issues because the model was deemed non-compliant.
Bespoke Bancard Solutions wants to help our merchants by educating the need for high-security standards and making sure that all technology used for running credit card transactions are secure and PCI compliant. It is important that when choosing a payment partner, your partner has set tools in place to analyze patterns and suspicious behavior to protect your customer's data from being compromised. We're here to help you reduce fraud and chargebacks and to simplify your PCI DSS.
If the company you're currently processing with has allowed you to become Non-PCI-Compliant, it's time to find a partner that cares. That partner would be us. We are here to help you and your business.