Why reliable credit card processing matters for high-risk industries?
Credit card processing seems pretty straight-forward from the perspective of the end user. However, those who have to work on the technical side of things, as well businesses in high-risk niches know that credit card processing is a constantly evolving thing. The reason for that is simple – fraud, theft, scams, and simple processing errors are so frequent that credit card processing platforms work daily to make sure they operate in the most reliable way possible. So, below we’ll take a look at exactly why reliable credit card processing matters so much for high-risk industries in particular.
1. Fraud prevention
The simplest and most significant answer is – to prevent fraud. High-risk businesses, i.e. businesses operating in industries and niches where fraud and scams are prevalent, are at a constant risk of various types of frauds on daily basis. From simple money scams to identity theft and money laundering, high-risk businesses are always struggling to protect both themselves and their clients from all kinds of attacks, especially when it comes to credit card and online payments.
As such, the good and reliable secure credit card processing platforms today incorporate a range of tools to analyze transaction patterns, secure payment processes, monitor for untrustworthy activities, and prevent fraud. Everything from two-step authentication to machine learning algorithms is used in credit card processing today to ensure user data and money stay as protected as possible.
2. Protect sensitive user data
The sensitive data of the clients of any high-risk business is arguably at even more risk than the money included in any given transaction. The most dangerous type of credit card fraud is the one that aims to steal sensitive user data, which can then be used to steal even more significant sums and commit frauds on a much larger scale against both individuals and businesses. Losing a payment here and there is annoying and bad for the reputation of the business, but data fraud is where the big risks lie.
3. Chargeback reduction
Chargebacks don’t appear all that significant at first glance, as they rarely involve large sums of money. However, fraudulent chargebacks, i.e. chargebacks that are dishonestly initiated by the client to attempt to get their money back even though the other end of the transaction has come through successfully, can pile on rather quickly. So, while individual chargebacks aren’t that much of an issue, a large-scale business can end up losing a lot of money over time if fraudulent chargebacks aren’t addressed.
That’s why good credit card processors, e.g Paycompass.com, always go through the extra step of verifying the identity of every cardholder and secure every payment to save you significant financial losses over time.
4. Meeting compliance requirements
Compliances requirements, such as Payment Card Industry Data Security Standard (PCI-DSS) or the PSD2 Strong Customer Authentication (SCA) in the EU are a must-have in many industries and areas. The problem for many businesses is that complying with such standards is typically the job of the credit card processing platforms they work with, but the fault will fall on the business itself if the payment processor they use didn’t comply with the necessary industry standards.
So, while it’s easy to assume that a seemingly reliable payment platform is surely complying with the right standards, it’s important to always make sure that’s the case yourself.
5. Stable growth on a global market
There is another issue that stems from the fact that different states, countries, and areas have different legal requirements. It is that maintaining a stable, fast, and reliable global growth requires that your business is always in line with the varying requirements of every new place it enters. This is especially the case for businesses in high-risk industries as the requirements there are even more stringent.
Fortunately, a reliable payment processor that is already operating on the global market should already be in compliance with such regulations anyway. The key word here continues to be “should,” of course, and the business itself should also always make sure that’s the case before they start working with a new credit card processor.
6. Maintain good reputation
Fraud doesn’t just lose you (and your clients) money, it also dampens your reputation. It often takes as little as one or a few instances of large-scale fraud for entire businesses in high-risk niches to lose their reputation and be forced to either retreat from a particular market or niche or just close doors altogether. Using a reliable payment processor is the simplest must-have prevention step to make sure it doesn’t come to something like that.
