How to save your business from payment fraud?
Contents
- How to Save Your Business from Payment Fraud?
- What is Payment Fraud?
- Types of Payment Fraud
- Strategies to Mitigate Payment Fraud
- Spread Awareness
- Use Secure Payment Methods
- Additional Verification
- Use a Secure Internet Connection
- Use Payment Apps
- Wrapping Up
Do you own a business and worry about payment fraud?
Running a business online has a lot of benefits for businesses. Some of these have better control and a bigger customer base. However, if you have an online business, you can easily become a target of a cybercrime.
Cybercrimes can affect your business in a bad way. Payment fraud is one such cybercrime that can cause you to lose money. It is important to point out payment fraud. So that you can save your business and customers from it.
Let us discuss the types of payment fraud. We will also discuss how you can save yourself from them.
What is payment fraud?
Payment fraud is an action that takes away your business’ money or violate privacy of data. The targets of payment fraud are mostly unsuspecting businesses and individuals. It also includes false refund requests. It happens in-store and online as well. Any tactic where a credit card’s information is misused or stolen is also considered payment fraud.
Payments fraud occurs in many shapes and varieties. It keeps evolving as hackers keep coming up with new ways to steal funds from businesses and individuals. Hackers use various tactics to get victim’s financial information. They drain bank accounts or make several authorized transactions. In some cases, this financial information is also sold on the dark web for a hefty price.
Payment fraud is especially harmful for businesses as it causes them to bear financial loss or lose their reputation as their customer data gets compromised. Businesses also lose customer trust, if the fraud directly impacts their customers.
Types of payment fraud
A common type of payment fraud usually gets a person’s credit card information. In other cases, payment fraud targets businesses when a customer disputes legitimate transactions. Sometimes, a customer can also pretend they didn’t receive goods and claim a refund.
There are many types of payment fraud but let us focus on the types that specifically target businesses.
- Email compromise: Also called Business Email Compromise (BEC), this is a common type of fraud faced by businesses. Fraudsters use email addresses that appear to be from a trusted source and request funds or change of funds. These email addresses are either similar to a real one, or a legitimate email address is hacked.
- Merchant identity fraud: This involves fraudsters pretending to be a business and charging customers. They convince real customers to make purchases of goods that will never be delivered.
- Chargeback fraud: It is also called friendly fraud or cyber shoplifting. It occurs when customers dispute a transaction after buying stuff online.
- Phishing: It is when a customer puts in their credit card information on a spoofed website. It is used to steal a customer’s private information which is then misused to make unauthorized transactions.
Strategies to mitigate payment fraud
The good part is that you can take special actions that can save your business from payment fraud. All you have to do is to adopt practices and tools that can help you monitor, detect, and prevent fraud.
1. Spread awareness
Businesses should keep their employees and customers aware of key markers that can lead to payment fraud. Some businesses even make this awareness a part of their content strategy. They send emails and newsletters detailing ways to prevent fraud.
You can also help your employees learn how to do it. There are a lot of training material on cybersecurity available on the internet. You should use it.
2. Use secure payment methods
There are some secure payment method that you can encourage your customers to use. These methods can save your business and your customers from losing money to hackers. For example, some people use virtual credit cards which are a one-time use thing. Digital wallets are also a secure payment method.
Some companies use phone payments to save their customers from financial fraud. For example, Cox has multiple payment methods for both its English and Hispanic customers. It allows them to pagar Cox en español por teléfono. Since customers directly contact the business so, the chances of a hacker coming between them are next to none.
3. Additional verification
You can set up additional verification methods for your payments. This means you can ask your customers to prove their identity, if you find something suspicious. You can also set up security questions with each customer profile which you use to verify each customer.
This is a great way to save your business from identity theft and phishing.
4. Use a secure internet connection
WiFi hacking is the most common way for hackers to get your financial information. So you can invest in an internet connection that uses extra security. This way you can keep your data safe from various cyber-attacks.
5. Use payment apps
If all of these are too much for you, do not worry. There is still hope, with payment apps.
You can store multiple payment methods in one place with payment apps. PayPal, Google Pay, and Apple Pay are common payment apps. These have better security practices like multi-factor authentication which can protect your transactions from fraud.
Wrapping up
Running an online business can be scary, given the increase in cybercrime and fraud. But the good thing is that you can always protect your business by being careful. You can do so by training your employees, using secure payment methods, and adopting cybersecurity practices.
