Selling products online is a fantastic strategy for small businesses, but there is risk when you accept credit cards. With credit card fraud running rampant, thanks to technology moving at light speed and hackers finding new algorithms to get credit card numbers, your business is at risk.
Fortunately, there are measures you can take to reduce your exposure to credit card fraud.
#1. Require Layers of Authentication
It’s standard these days to require several pieces of information during an online transaction, including:
- Phone number
- Card number
- Expiration date on card
Go one step further and require shoppers to input the CVV2 or CVC code from the backs of their credit cards. Hackers can’t get this information without physically having the card, so it can greatly reduce the number of false transactions you process.
#2. When in Doubt, Call
If there’s something fishy about a transaction (like someone ordering 500 fish tanks from your site), call the number you have for the customer. If that doesn’t work, email them before you process the transaction. Essentially, you want confidence from the person whose name is on the card that they indeed did make an unusual purchase.
#3. Use an Authentification Program
Credit card companies use authentification programs to ensure the identity of a card user online. By participating in these programs, you remove some of the onus of loss that occurs during online fraud, as the credit card company takes it on.
Keep in mind, this does add a step to the purchase process, which may be a turnoff for some of your legitimate customers, but it may be worth it to protect your assets. These programs will charge you a fee to process each transaction.
#4. Make Sure Bill to and Ship to Addresses Match
Here’s a red flag: the name and/or address listed under the billing information is different from that in the shipping details. While there are legitimate reasons for this (perhaps your customer is shipping a gift), it’s a wise idea to follow up with your customer to verify the transaction.
#5. Become PCI Compliant
The Payment Card Industry Security Standards Council is an organization designed to protect merchants from fraud. It has compliance regulations that, if you meet, will provide an additional layer of protection. One requirement is that you secure cardholder data in order to be compliant. Find out other requirements here.
Credit card fraud can cost you valuable time and money, and even jeopardize your business. It’s a real threat, and one you should be proactive on to mitigate your risk.
Images: “Woman shopping using tablet pc and credit card .indoor.close-up/ Shutterstock.com“
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