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Preventing Credit Card Fraud

jjensen | 21 November, 2005 22:17

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Preventing fraud with credit cards takes place long before a DRTV marketer realizes that someone has just stolen their merchandise. Many times, the key to success comes years earlier when the marketer selects their merchant provider and sets up their credit card processing guidelines.

A sophisticated merchant provider, or payment processor, has the ability to give tools and wisdom to their customer to help them prevent fraud.

One example of how to prevent fraud is the ability to accept or deny customer orders when the shipping address does not agree with the credit card customers billing address. If the person on the phone is the real customer, why would they not know their own billing address? Yet the inability to pass this test is one of the top practices that results in fraud.

Another powerful example of how to prevent fraud is the ability to collect and process payments only if the customer supplies the CVV code. The CVV code is the 3- or 4-digit number found on the back of a credit card and is an additional security method used for transactions taken over the phone or internet, which are also called “card-not-present” transactions. These card-not-present transactions are especially prone to fraud because the customer is not standing in front of you with their credit card and ID in hand. This simple step helps offer protection against customers who attempt to process a transaction paid for by a stolen credit card.


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Multiple Forms of Payment Processing

jjensen | 21 November, 2005 22:14

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Payment processing has evolved from a one payment only form of service industry into an industry that is scrambling to find and implement new ways to accept payments from customers.

Years ago the only form of payment many retailers took was a paper check. Slowly the wide use of credit cards started to create an environment where the cost of accepting credit cards far outweighed the lost sales if you did not accept them.

Fast forward to today. Now you will find an environment where many Americans have limited access to credit cards because of credit over extension or bad credit while other customers demand to be able to use their credit cards because they want to earn the affinity points.

So how does a DRTV marketer collect payment from a “credit challenged” customer? They migrate to debit products which have turned up in 2 forms, Visa debit cards and electronic check products. All these products are available over the phone or internet with no paper documentation because they all clear thru a gateway using a secure SSL internet socket.

And still DRTV marketers continue to look for new ways to capture payments from every possible customer in every possible form imaginable.


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