March 26, 2021
Every business has to be prepared and equipped to fight fraud, especially on the web. If you have an e-commerce store, the you need to have a strategic commitment towards saving your business and customers from fraudsters.
E-commerce stores are at a higher risk for fraud because where there is money involved, there will be criminals eyeing it. Retail business owners often feel the impact of fraud(s) most directly and mounting costs are applied in terms of lost merchandise and other damage control steps.
But with effective protection strategies and e-commerce security, fighting e-commerce fraud and keeping your business going strong is absolutely possible.
E-Commerce fraud is basically any type of illegal or false transaction performed on an e-commerce platform by a fraudster, using stolen payment information for online transactions without the knowledge of the account owner. This may be done through a false identity, stolen or fake bank cards and details, false personal information, etc.
Stealing Card Details - The fraudster creates an online store that offers expensive products at much lower prices. When a customer places an online order by using his credit or debit card on this fraudster’s website, thinking it to be a genuine e-commerce store, the details are leaked to the fraudster and the fraudster can then use the customer’s money with these stolen card credentials.
Interception Fraud - The fraudster creates order entries and info using stolen credit card information, and they may deliver the products to themselves while the actual customer who is the owner of the card becomes a victim of interception fraud.
Identity Theft – The fraudster may gain access to a registered customer’s credit account on an e-commerce store and uses the saved bank card information in it to pose as the customer to shop for himself.
Here are things digital business owners can do to ensure safety against possible e-commerce fraud:
An AVS (Address Verification System) helps businesses secure the transactions on their e-commerce stores, by verifying the customer’s billing address and to ensure that it is of the same credit card company that is present on the records. So, businesses need to implement an AVS for their e-commerce site transactions.
Businesses should set a strong requirement for passwords so that it protects their customers as well as business.
A password should have at least 7-8 characters that include both uppercase and lowercase letters, and special characters too. It is a smart practice for customers and account holders to insert different types of characters in your password to reduce the chances for attackers hacking it.
A business or brand’s e-commerce customer service team plays a vital role in the efforts of protection from ecommerce fraud.
If the customer support team employees are not properly trained, and simply rush the order approvals, it may allow fraudsters to hack through business security systems without much hassle. Fraudsters have mostly been known to target front-line customer care representatives who generally do not possess the required level of anti-fraud training. So, it is crucial to train customer service employees and have them watch out for fraud indicators.
…or getting it done by your team! Unless your website is receiving hundreds or thousands of orders each day, it is not necessary to automate the order fulfilments.
Each order can be checked by your team of experienced sales employee(s) instead of an automated system. This is because sometimes, human intuition can be more powerful than a machine which mechanically does the job and recognizes only specific patterns and disturbances, and can prevent potential issues that a software may miss.
If checking every order manually doesn’t seem practicable, then a minimum of some orders that are unusual can be monitored and verified manually. If an order seems suspicious – that is too large or too expensive, the customer can be called and asked about it, citing verification purposes and this can help you decide whether or not to fulfil the order. Customers can also know their security is being taken care of and will appreciate the step.
Businesses should ensure, at the beginning itself, to build your e-commerce store on a secure and well-known hosting provider. It is better to avoid risks like trying out new or cheap ecommerce solutions just for the sake of spending lesser or to avoid spending time in more research.
So, these are some e-commerce fraud prevention strategies that business owners can use to secure your business from the inception (in case of new businesses) and with minimum effort (for established businesses).