Fraud has been on the rise due to the widespread use of digital and mobile channels. When covid hit, stay-at-home orders were issued, and non-essential brick-and-mortar businesses closed unexpectedly. Both companies and consumers needed to respond quickly to this change.
Over the past several months, global retail has seen e-commerce sales grow over 81%. Some sectors have seen triple-digit growth year over year. With every opportunity comes a challenge and most online retailers have been ill-prepared to handle this which has resulted in rapid fraud loss increases. Every dollar of fraud results in $3.27 of fraud costs, and it's eating up a decent % of total revenue. Cybercriminals are becoming ever more sophisticated; hence it's imperative for merchants to respond quickly to increasing cyber threats and be prepared for challenges
It's no longer a matter of whether hackers will target your business. It's a matter of when?
Friendly fraud is anything but friendly. Friendly fraud has grown in recent years with the rise of Ecommerce. A customer makes a purchase online for a product or service with their credit card and then contacts their credit card issuer to dispute the charge. This type of fraud is often referred to as friendly because the customer will make claims that seem believable and honest.
Card Testing is a technique where the fraudster is trying to determine if he can use stolen card information to make purchases. Card Testing is also referred to as auth (authorization) testing and is a trial run for fraudsters for $1 or less, hoping that it goes through, or even if it doesn't, it won't raise any significant flags if it gets declined.
One of the most common forms of credit card fraud is simply stealing someone's credit card and using it for a purchase.
Account takeover is another form of identity theft and fraud, where a malicious third party successfully gains access to a user's account credentials. A simple example could be a fraudster taking over social media account and inventing a reason to request money from the family and friends of the victim.
Take advantage of security tools like reCAPTCHA built into the payment experience. Simply put, CAPTCHAs enhance security and prevent sites from being affected & attacked by hackers.
Enable standard security elements like postal code validation, address verification, and CVV on the payment pages to make it difficult for fraudsters to impersonate anyone. No single factor is effective at preventing card testing fraud. Hence, we recommend a multi-layered approach that can help merchants avert card testing fraud attacks.
Merchants can implement IP blocking rules and velocity checks within their own system to prevent these attacks.
Bluefin also has various internal monitoring mechanisms through our PayConex payment gateway that helps detect critical vulnerability indicators like high traffic in a short amount of time with the same attributes, low transaction values, increase in failed authorizations and specific decline codes.
3D Secure 2.0 adds a layer of security to prevent fraud in ecommerce transactions with credit and debit cards. It is a consumer authentication service that helps shift the chargeback liability off the merchant account onto the card issuer. It sits on the payment form & allows the acquiring bank to verify with the issuing bank that a cardholder is who they say they are. If you are a merchant experiencing the chargeback codes 10.4837 and 10.4863 then 3DS can help you.
Bluefin’s fraud-scoring tool helps in real-time decisioning for every transaction. It analyzes risky transactions using criteria such as device intelligence, behavior analysis, customer attributes, past payment activity, and more to keep your system secure.
We also recommend using our ShieldConex platform to make Personally Identifiable Information (PII), Protected Health Information (PHI, and cardholder data worthless on the web. ShieldConex data security platform, utilizes both hardware-based encryption and vaultless tokenization to secure sensitive data entered online.
Merchants should pick tools based on their experience with fraud. Depending on the service you provide, the goods you sell, how your business operates, the kind of industry you are in, certain methods may be more effective than others. For example, the volume/percentage, chargeback codes merchants are hit with & will then need to devise a strategy to combat fraud. The end result could be a mix couple of different strategies or just one. We recommend our Merchants to gather KPI's around their existing fraud rate, 3 of manual reviews they encounter, chargeback rates for us to be able to pick a solution that is right for them.
Updated 2 months ago