Prevent Card Not Present Fraud with These 5 Tips

Merchant credit card processing

If you are a merchant these days, you have to take credit and debit cards if you want to stay in business. This is especially true if you sell items online or over the phone. It can be easier to spot credit card fraud when the person needs to present the credit card, especially if the card has the person’s photos. The global economy is expected to lose at least $35.45 billion to fraud in 2020. Card not present fraud prevention is something all ecommerce sites and businesses who take credit cards over the phone need to care about and work on. If your business fits into one of those categories, there are things you can do to take credit cards and not be the victim of this kind of fraud.

  1. Verify the customer’s telephone number. When a customer orders something over the phone and you are going to shop the item, take notes of the number and the transaction number. When you are preparing the order for shipment, take some time and call the number that the customer gave you. Verify the transaction information with them. This is not going to a foolproof way to verify that this transaction that is an instance of fraud or not, doing this can help in your card not present fraud prevention plan. People who are honestly trying to make real purchases with their own credit card will appreciate your due diligence.
  2. Spend some time looking at express shipments. If you offer free shipping but you get some strange orders for express shipments, you should look into them. Most people will opt for the free shipping but criminals, who have stolen credit cards do not care about the cost of the shipping because they are not paying for it. A good practice to get into when you are looking into effective card not present fraud prevention is to keep an eye on these purchases. Keep in mind that there are valid reasons for needing expedited shipping. A person who forgot a friend’s birthday, for instance, may need their shipment to be sent faster.
  3. Do you have regular customers? if someone buys from you on a regular basis and you get an order than does not match their normal profile, check with them. They may be buying gifts when they normally get certain other items for themselves so the order may be valid. If you call the customer to check on a suspicious order, they will appreciate the fact that you pay attention to what kinds of things they buy and care enough to check. This will help your reputation as a trustworthy and caring business owner.
  4. Use the address verification system (AVS). This system lets businesses with their card not present fraud prevention plan by helping them compare the billing address that is given by the person making a purchase to the billing address that is on file with the credit card company. If someone stole a credit card, unless they stole it from someone they know, they probably do not have the right billing address. If the address given does not match the address on file with the credit card company, do not process the sale.
  5. Ask for the Card Security Code. Credit cards now have a security code on the back. This is normally found on the back on the card next to the area where the signature is. Each kind of card has its own kind of code. Discover calls this a CID, Visa has CW2 and for Master Card, the number is a CVC 2. The good news is that they are all in the same place and they all are three digits. Asking for these numbers is one you can approach your card not present fraud prevention because the person mostly likely has the card if they have that number.

At the end of the day, there really is no way to totally prevent all kinds of credit card fraud. Even the most diligent practices do not work 100% of the time. One thing you can do is deter the criminals. This can make more of a difference than you know.