In the world of online business, we have more exposure to fraud than an offline business world. In person, you can see what a person looks like, you can ask for identification, and you physically see the cash or card being used to make a purchase.
With an online business, you don’t usually get these things. Instead, you are sent details over a computer, with no face attached, and are asked to trust that these are correct. When they aren’t, money can be lost. Your transactions might be covered by insurance, but you can still lose out on costs such as shipping or fee’s to your payment processors. On top of that, you can even lose a merchant account if you fall victim to fraud too often. It can become a serious and extreme worry if it carries on, that is why online businesses need to get checked out to see what is going on in their system. Using a business such as Castle can help with fraud detection and see if there are any other malicious problems happening within a business.
Running an online business opens you up to new opportunities and customers, but also exposes you to potential fraud in ways that traditional brick-and-mortar stores do not. Without face-to-face interaction, it can be easier for criminals to steal identities or payment information. Common threats include phishing attacks trying to gain login credentials, fake online reviews intended to mislead customers, or chargeback fraud where purchases are made with stolen credit cards.
The good news is there are steps you can take to protect your business. Investing in trust seals and SSL certificates can help establish legitimacy and security for your customers. Rigorous verification of new user accounts reduces the chance of fake or fraudulent registrations. Ongoing monitoring of transactions – especially spikes in sales or returns – can identify suspicious activity early.
Perhaps one of the best investments can be partnering with a provider offering reliable IT managed services in the South East or elsewhere. The right provider can act as an extension of your team, proactively assessing vulnerabilities, promptly applying security updates, monitoring activity, and quickly responding to threats. With expertise that a small business may lack, they strengthen your defense against fraud through technological protections and human insight. Considering the scale of fraud losses facing the e-commerce sector, managed IT services can deliver peace of mind at an affordable price point for most operations.
With online fraud expected to cost over $7 billion by 2020, this is a serious issue that has to be fixed. Thankfully there are also some tools which you can use to help detect and prevent online fraud. To be truly effective, you should combine multiple tools which have different strengths and weaknesses, to create a complete system.
- Address Verification
Address verification is a simple tool to use. It checks the address details used in the order against those on file with the bank associated with the account holder. This can sometimes be gamed by using a gift address for the delivery, but that would still require the right address to be used in the order – and the address is tougher to get hold of than a card.
- Identity Verification
You can also use a tool which checks the authenticity of any ID used in the purchase. Netverify is useful for this, it works by taking a sharp picture copy of any ID, then checking it against the details of that ID in an identity database. If the details don’t match, the card will be declined.
- Check CVV Codes
The CVV code is something which should never be stored, so it’s a piece of information which can only be gotten from the card. By asking for it, you are ensuring the card is present when the order is placed.
- Using a Blacklist
A blacklist holds various details which are suspected of use in fraudulent transactions. By checking details against known blacklists, you can auto-decline any suspicious purchases. What’s more, you can even contribute to these lists if you do become a victim of fraud, or even create your own list if needed.
- Use Payer Authentication
This refers to programs like ‘Verified by Visa’ and ‘SecureCode’. These systems are external to your process and are run by the card providers themselves. They hold the most data on their cardholders and have a high standard of security. Adding the use of this authentication to your business can eliminate a lot of fraud.
The system works by asking for details which are not listed on the card, and which only the cardholder should know. If the details don’t match, the transaction will be declined. Because this is offered by card providers, it tends to give you a lot of extra protection against fraud.
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