Fraud is a common problem in the world of eCommerce and it can have a severe negative impact on the development of your online business. Before you encounter chargeback fraud, interception, account takeover, or another type of illegal activity, it is important to take steps to minimize the risk. With the help of the right software for fraud protection and several other methods, you will be able to secure your business.
What can you do to prevent fraud?
If you want to be proactive and make sure that you prevent fraud as much as possible, these are the steps you should take into consideration:
1. Integrate fraud prevention software
There are plenty of services out there that are designed specifically to analyze online transactions and any potential risks associated with them. Their technologies, such as device fingerprinting, are effective at collecting data of devices used for purchases and assessing their reliability. Integrating anti-fraud software with your systems is an effective way to improve the security of your business.
2. Check your site for any weak spots
Looking for flaws in a system that you use is important. If you have a site, you should regularly check whether there are any problems with security. You should make sure your SSL is active, your software is updated, there is a backup function, and you, your staff and clients use strong passwords. Moreover, you should regularly scan the system for viruses and malware. Your online store should also be PCI (Payment Card Industry) compliant.
3. Don’t store customer data in your system
Collecting data of your customers, such as birthdays, Social Security numbers, and others, makes your store more sensitive to fraud and hacking. You should collect only essential information that you need to complete the order.
4. Make sure your clients enter their CVV numbers
One of the ways to reduce fraud and increase the chances that a person has a credit card in their hand is to have a field to enter the CVV number when they make a purchase. This is a simple solution but it’s definitely a must when it comes to reducing fraud.
5. Have a limit on purchases in your online store
It is a good idea to set a limit on how many purchases can be made using a single account in a day. The exact number should depend on your particular business and revenue trends. If you become a victim of fraud and have this limitation in place, you won’t experience significant losses.
6. Compare the credit card address and the IP address
Another way to see a potential red flag with a transaction is to check whether the region indicated by the IP address and the address of the credit card coincide. This method alone is not enough to suggest a suspicious customer as they may just like to use VPN but it can be used in combination with other signs.
Fraud prevention is possible
Whether you have already experienced some issues with fraud or you haven’t yet, taking measures to prevent such problems should be your priority. When used correctly, modern technologies can significantly help you reduce the possibility of experiencing fraudulent chargebacks and other problems.
Do you have other recommendations on how to prevent fraud? Have you used any of these methods? Share your experiences in the comments below.