Managing the risk of fraud has become a critical and fundamental challenge for merchants and consumers, which becomes more urgent as time passes. However, it mainly affects e-merchants. That is why chargeback fraud protection for merchants is very essential to having a successful enterprise.
Table of Contents
Doing Business Online
As ecommerce grows in popularity, so too do the fraudulent activities associated with doing business online. This is why all merchants, from small startups to massive retail chains, are vulnerable. There are several types of fraud and ways to prevent it, but mismanaging fraud protection can be costly and frustrating. Therefore, it is very important to have some kind of awareness about how ecommerce has resulted in fraudulent online purchases, the risks that merchants and vendors have to face, and the kinds of tools needed to counteract this. You must be aware of the risks involved and this will help you to take the right measures in protecting your assets, profits, business, and reputation.
Types of Chargebacks
There are three definitive ways that merchants experience charge backs:
- Using stolen credit cards
- Theft of a consumer’s identity
- Use of stolen card data, without presenting the actual card itself
The use of the data of a stolen credit card, without presenting the card itself is grounds for scams and fraud. Fraud in business-to-business transactions is also on the rise. Its broad scope and evolutionary nature make it necessary for companies to take proactive measures to protect their assets and identity against this threat.
The Consumer
As a consumer, when you go to a physical store or online store, the motive or goal is to make a secure purchase with a credit card, debit card, check, or cash. Using plastic has become the main form of payment for most consumers. It is just easier to pull out a card and pay for an item without counting out cash. For online purchases, credit cards and debit cards are the ‘go to’ mode of payment. Therefore, it can hardly be avoided. If you want to keep your card safe from fraud, it is best to have protective tools to ensure that your identity or financial information is not stolen.
Conclusion
You should always stay abreast of your financial details. Use complex passwords and usernames to hide your identity. In fact, change these as many times within the year as you can. Don’t give your financial information to a company unless you do your research. If you are going to make an online purchase, scour the website to make sure that they have iron-clad security that protects you as a consumer. If you have been defrauded by anyone, learn how to dispute credit card chargebacks.