eCommerce fraud prevention remains a significant concern for businesses who strive to offer a fluid customer experience. Significantly, 63% of small businesses suffer losses to a cyber attack, as according to a Nationwide Study. Any invasion of this nature is hugely damaging. Companies often fail to realize handling of a fraudulent transaction for weeks or even months later. Therefore, by the time they are flagged, it may be too late to impose any criminal or dispute charges.
Constant monitoring and strong eCommerce fraud protection practices help protect your business from a possible fraudulent transaction. It is with tracking and eradicating the potential threat in the very first instance.
We have listed best practices and tips on how to prevent eCommerce fraud and help minimize the risks.
eCommerce Fraud Prevention Best Practices:
- PCI-DSS Compliance
Safeguard a secure connection for online payments with your business by becoming PCI (Payment Card Industry) compliant. The PCI DSS (Data Security Standard) is a set of security standards. They are designed to ensure that businesses globally accept process, store, or transmit credit card information while maintaining a secure environment. Conduct regular PCI scans several times a year to reduce the risk of your eCommerce platform being vulnerable to hacking attempts.
- SSL Certification
SSL certificates help authenticate the identity of your company and encrypt data in “transit.” It provides extra protection to your business and for your customers. For example, to validate a credit card payment, a payment gateway will use the online address verification services. Therefore, this address along with the card verification system prevents fraudulent purchases by validating it with the data listed online with their credit card company.
- IP Address Verification
If the IP address is from a usual location than the customer’s billing or shipping address, or if the IP address is from a web hosting company or proxy server rather than an individual account, you may be dealing with a fraudulent customer. You must deploy eCommerce fraud prevention solutions designed to monitor, track, and resolve such discrepancies for your website.
- Fraud Management Solution
An approach recommended by most of the experts, it offers preemptive mitigation of possible frauds before they happen. 3D-Secure – a stepwise cardholder authentication process ensure security for all transactions. It generally requires the users to enter the security code for the validation of input. Further, it transfers the merchant’s responsibility for the sale to bearer’s bank in the event of possible litigation. It is a common practice by most of the credit card companies.
- Using Strong Passwords
Hackers or Online Fraudsters employ sophisticated programs and algorithms to map through the possible permutations of password creation string. With the help of the latest eCommerce fraud solutions, define strong password structures. The customers might find it frustrating initially but will thank you later for ensuring a safer and hacker proof environment. Best practices today call for eight-digit alpha-numeric passwords with at least one capitalization and one unique character.
- Chargeback Prevention
The cardholders themselves perpetuate a chargeback fraud. They purchase items online to claim that they have defrauded. If the merchant cannot prove that the holder authorized the transaction, then the total amount of the purchase is refunded to the customer, who can then keep the items purchased, while the merchant suffers a loss. One of the eCommerce fraud prevention best practices you must follow is to deploy a chargeback prevention solution on your site.
- Understanding Customer Behavior
Real-time analytics tools let you see how visitors are navigating through your website and allow seamless interaction across sections. Further, they even help to detect fraudulent or suspicious behavior and thus prevent possible damages. By putting together appropriate rules, such as introducing a “break” if the same credit card gets used more than three times in the week for the same site and exceeds a certain preset amount.
- Other E-commerce Fraud Prevention Techniques
Regular shopping cart software updates and limits the number of declined transactions per account are effective ways to prevent eCommerce fraud. Further, using advanced platforms like WordPress or Magneto for your eCommerce site can add security layer.
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