Online payments are the lifeblood of modern businesses. Unfortunately, eCommerce transactions aren’t as simple as handing someone a $20 bill. The ease of digital payments comes with a large string attached: fraud risk.
Every online retailer needs to be able to manage fraud effectively, but successful payment risk management can’t stop there — businesses also need to account for issues like compliance regulation, consumer confidence levels, and lost transactions caused by fraud prevention tools. Lost transactions alone cost businesses an estimated $165 billion in 2018.
Payment risk management means finding solutions for all of these issues. The best way to address all the risks of eCommerce is with an effective fraud mitigation stack — a collection of tools that mitigate risk and proactively address revenue loss.
We’ve compiled the following list of powerful tools that are essential for effective fraud control. Read on to learn how to optimize your payment risk management.
Stopping Fraud Before It Starts
1. 3-D Secure: Authenticate Your Clients
Strong customer authentication does more than reduce online credit card fraud; it’s a legal requirement in markets like the EU.
3-D Secure meets that need. 3-D Secure is an authentication tool for online transactions to verify that the person using a particular credit card is actually the cardholder. It enables the card issuer to identify questionable purchases and instantly send a text message to the cardholder. If the charge is illegitimate, they report the fraud before the charge even goes through.
3-D Secure doesn’t just prevent fraudulent charges; it also allows your company to maintain a strong reputation as a secure, customer-oriented retailer. In an age of data breaches, customer confidence is invaluable. If your company processes payments in the EU, 3-D Secure also ensures that your company is compliant with the latest PSD2 regulations.
For all eCommerce businesses, 3-D Secure is a foundational tool to prevent fraud and manage payment risk.
2. Effectively Prevent Fraud, Without Lost Revenue
BlueSnap has teamed up with Kount to offer top-of-the-line fraud prevention technology. With Kount, you can instantly learn whether a transaction is fraudulent. Kount’s technology combines supervised and unsupervised machine learning to analyze every transaction against hundreds of relevant data points in milliseconds. But unlike other fraud detectors, Kount can tailor its services to your industry and business needs, minimizing the number of unnecessary declines.
Kount’s unique capabilities can be set up in three different ways through BlueSnap: You can leave fraud rules in the capable hands of experts at BlueSnap, modify those triggers to better fit your industry, or use your specialized knowledge of payment risk to entirely control fraud detection rules. For all account types, Kount uses advanced security tools such as multi-layer device fingerprinting to score transactions and determine the likelihood of fraud on each transaction.
With a system that takes individual business needs into account — from transaction size to speed or origin — you can be confident that fraud will be detected quickly and accurately, without unnecessary lost transactions.
Preventing Chargeback Losses
Chargebacks occur when a customer challenges a transaction with their card issuer. Chargeback processes can protect customers, but when eCommerce retailers don’t manage their chargebacks effectively, they can result in enormous, unjustified revenue losses.
3. Automated Alerts and Chargebacks911
BlueSnap helps businesses regulate and dispute chargebacks in several different ways. If a chargeback isn’t disputed, the business loses that sale and the money is returned to the cardholder. When invalid or false chargeback claims are filed, online retailers need to respond quickly with effective evidence to prevent loss. Chargeback claims operate like a court case, so any dispute must be met with a strong body of evidence.
Automated alert tools help you stay on top of all chargebacks, including by preempting potential chargebacks that haven’t officially been filed. With automated management, you can prevent and dispute chargebacks easily.
Chargebacks911 takes this service a step further. It supports businesses by integrating with existing systems to create a thorough body of evidence on your behalf. This prevents invalid chargebacks from harming your company.
4. Meet Regulations with Security Metrics
Online retailers also need to stay on top of payment regulations, such as PCI compliance. Essentially, your business needs to prove that it is handling credit card data properly.
BlueSnap partners with the experts at Security Metrics to categorize your level of PCI compliance and ensure that your website and its payment methods are well-regulated.
Mix Technology and Experience for Fraud Protection
At BlueSnap, our fraud stack combines these powerful tools with our deep knowledge of payment risk management. Strong management saves time, returns revenue, prevents fraud and fosters trust among your customer base. Get in touch with us to learn more about how we can help you manage your payment risks.