There’s no surefire way that you can stay safe from credit card fraud. The only way that you can avoid this problem is if you avoid payment through cards, but that would be seriously limiting your market. That can also mean the end of your business since most people prefer to pay using cards.
As a business owner, you should be aware of the best precautions that you can take against credit card fraud.
What You Can Do
Credit card fraud is a form of theft. The perpetrators get the card or the information of the card and its owner and use those to make purchases. There are two victims in this case. First is the cardholder. He may lose money even if he did not authorize the purchase, and the actions of the thieves may ruin his credit score. Then there is the business owner who will also lose money in the process.
What can you do to stay away from being victimized by these digital thieves?
Unfortunately, there is no single solution for preventing credit card fraud. But, there are some useful ideas that you can use to fight them. The first and the most simple precaution that you can take is to be extra careful when accepting payments through credit cards.
You need to be consistent when it comes to checking the identifications and signatures. You should also look for additional security features on the card like holograms. Another important security step that you need to take is to check the address of the cardholder and what is given to you.
For online transactions, you should use verification codes which will make it doubly difficult for criminals to use stolen card information. It also helps if you are consistently suspicious about all transactions. If you receive a sudden large purchase from a new customer, it might be a good idea to check the identity of that customer to make sure that it is a legitimate purchase.
Think about adding a step for purchases that are made online or those through the phone. For example, you should call the number of the cardholder on record. If the transaction is fraudulent, the cardholder will tell you immediately.
There are some types of businesses that are more prone to chargebacks. If your business belongs to that category, then you might need high-risk credit card processing. That should give you more layers of protection.
Friendly Fraud
Keep in mind that friendly fraud is also a problem. This happens when the cardholder makes a purchase but later on claims that he or she did not authorize the purchase. The aim is to get a product for free. You should also take steps to prevent friendly fraud.
Conclusion
Taking steps to prevent credit card fraud can save you a lot of time and money. Just dealing with these frauds can take up so much of your time, and it can affect the reputation of your business negatively too. Just remember that the chargeback fees can be substantial if you add it all up in the future.