Updated: January 5, 2014
Do you run an ecommerce business that accepts credit card payments?
This article contribution might help.
$11.27 billion. That was the amount of money that was lost around the world in 2012 due to fraudulent payment card transactions, including credit, debit and prepaid cards, according to BusinessWire.com.
Further analysis of the gross losses equaled out to a little more than five cents for every $100 spent in total volume. Although it can be very profitable for you to accept payments through online credit card sales, there are several ways that you can protect yourself from the dark side of such transactions.
Do Not Neglect an Authorization Check
Simply collecting credit card information from your customers is never enough. With the overabundance of stolen credit cards that have been reported within this country alone, it is of the utmost importance that you authorize every single credit card transaction before finalizing your orders.
Therefore, you need to make sure that you conduct a credit card authorization check for each transaction. Doing so will not only verify an actual customer, but will also verify that the customer has available the amount of money necessary to make that purchase.
Process All Refunds Directly Back to Cards
Although it may seem to be more convenient to refund an original transaction that was paid by credit card in cash, doing so could actually be setting yourself up for a fraudulent transaction.
Keep in mind that you have already authorized the customers that were using the appropriate credit card when the purchase was originally finalized. Therefore, you could be leaving yourself open to fraudulent activity if you do not retrace your steps accordingly when it comes to refunding that transaction.
Keep a Record of all Transactions
Another way that you can prevent fraudulent transactions is by simply maintaining an accurate record of all of your credit card transactions. Keep in mind that you may need to show documentation directly to your credit card processing company, especially in the event of a fraudulent transaction.
This is why it is of the utmost importance that you take the necessary steps to collect and maintain a continuous record of these transactions over time. You never know exactly when you will need to refer back to an old receipt, either from earlier the same month or even earlier the same year.
Do Not Hesitate to Check IP Locations
Even though it may seem to be excessive and unnecessary, checking the IP addresses of your credit card customers is another effective strategy that can be used to reduce the threat of credit card fraudulence.
Make sure that the IP address and the actual credit card address match up because this can essentially prevent you from becoming the victim of an overseas credit card scam, according to Small Biz Trends. If necessary, there are specific websites and online tools that can be used to manually research the IP addresses of your customers to protect yourself against these prevalent crimes.
Invest in a Cloud-Based POS System
One of the best approaches that you can take to crack down on credit card fraudulence is to completely remove that burden from your shoulders all together. With all of the other busy tasks and responsibilities that you have to take care throughout the day in order to keep your business afloat, you truly do not have the time to waste tracking and researching every single credit card transaction.
By trusting in the efficiency and performance of a cloud-based POS system that is programmed to authorize, finalize and manage all of your credit and debit card transactions on your behalf, there will be one less thing that you have to worry about in the long run, according to Entrepreneur.com.
This is a guest post by Larry Jones, a business consultant in UK.
Photo credit: EP Technology