Protecting against Credit Card Fraud
Operating an Internet business means that you're likely collecting, processing, and storing credit card data regularly. You therefore have to look at potential credit card fraud from two points of view: yours and the customer's.
Minimizing your own financial losses
E-commerce sites lose billions of dollars to online credit card fraud every year. VeriSign claims that online stores are 17 times more likely than offline stores to be cheated. That may be why 48 percent of adult consumers are still hesitant to give credit card information online, due to a fear of cyber-criminals, and 36 percent are less likely to enter credit card information online for fear of it being stolen. These statistics add up to potentially less revenue for your online business.
You want to be aware of potential security problems so you can combat them and protect your prospective revenue. Here are just a few of the ways that your online business can get hit with fraudulent transactions — and end up losing merchandise and money:
- Customers buy a product but then claim that they didn't order it (or file a similar complaint), and the credit card company deletes the charge.
- You unknowingly process stolen credit cards.
- You process invalid credit cards or cards that you should have declined.
Although you might think that the big online retailers are most at risk, smaller sites are often more likely targets because smaller sites usually have less sophisticated resources for detecting ...