Payment fraud is a term that scares every e-commerce business owner in the whole world. Fraud can be very costly and it can be with your money as well as with your credibility and customer’s trust. In general, payment fraud is any false or illegal transaction, which can happen on the internet, there will be no intimation to the user of fraud attempts prior. The cybercriminals usually steal someone’s money, personal property, or sensitive information like social security number. For years, through dark web other shady domains, fraudsters get their hands credit card numbers of customers. But in today’s days, compromised cards may be the least of a merchant’s worries. What is the worry for both consumers and businesses is personal information that is social security number or may your mother’s maiden name etc. If your social security number is leaked out in the market, it like you do not have an option to have a new number or you cannot replace that. Any criminal can take that number, apply in your name and ruin your credit score or ruin your relationship with banks. This is a very painful identity theft.
Payments fraud to watch out for
For Businesses, new types of fraud have become headaches, online marketplaces and other e-commerce sites are increasingly popular but they can be particularly unpopular with scams, as both buyers and sellers are susceptible to fraudulent practices.
e-Commerce is completely based on internet transactions, where customers are paying for products and services online. It is not hard to accept that with growing popularity of online businesses, the fraudulent activities are increasing.
Below are a few of the latest types of fraud and tips for merchants on fraud prevention.
In today’s world, the maximum number of consumers shop online and this count is increasing very fast. Fraudsters with time have found that most of the shoppers or consumers use the same login credentials. That may be your email password the same as your bank account password and the same for all your shopping sites too? check out. Fraudsters know that once they get anyone sign in and password combo, they can try those same details on many websites may be bank login may be shopping websites until they strike paydirt.
This Is one of the frauds that are not new but this has now got upgraded with new technical updates. In this type of fraud, criminals obtain large batches of compromised credit cards on darknet that they need to validate before they practice crime or steal goods and services. Fraudsters rely on automated tools that send trustworthy looking orders in small amounts to unsuspecting merchants or online shopping sites, buy this tech trick they speed up their crime. This leads to huge business losses as this harms payment conversions and drives high costs.
Friendly fraud or buyer liars, when a customer places an order online and receive product or services but wants a refund for any reason. Customer needs to claim for not receiving a product and such businesses are likely to eat the cost. Customer may claim that the product was damaged and demand a refund, another loss for the business. This practice of fraudsters will lead to online marketplace loss of million dollars.
Money laundering a very old type of fraud gets a new life in today’s online marketplaces. The drug trade and financing terrorism, criminals target a vast number of different international businesses are some of the cases of money laundering.
What merchants can do:
- Choose a payments partner with a long track record of dealing with fraud actions and a partner with extensive e-commerce experience. KYC and AML screening should be airtight and robust fraud management solution designed for this type of fraud should be implemented.
- Device Fingerprinting. Choose a partner going beyond the traditional device fingerprint by creating virtual identities that dynamically link all attributes of a potential attacker.
- Check in frequently with your customer. Send message alerts or email alerts at nearly every step of the buying and delivery process.
- Invest in the right technology Creating awareness around of anti-fraud measures by implementing the technology in your payment processing systems, since fraudsters will attack every business that involves customers. There are various technologies still you need to be in an alert state as you know that the security measures there but also fraudsters may find a way to bypass them.
These are the most common fraudulent scenarios, but you need to be prepared for some more absurd situations. When you run an online business, you need to consider how you will be acting in cases like those above. The thing is that customer is not always right and you need to protect your profits if you do not do that you will be suffering from most of the frauds.
If you are looking for a reliable merchant account provider, you are in the right place, as IPAYTOTAL provides the best solutions for e-commerce businesses. We guaranty quick real-time credit card processing, top-notch services and at reasonable rates. Give us a call at +44 800 776 5988 or get in touch with us through our website.