Holiday Fraud — Merchants Beware

The Holiday Fraud Season Is Here – Are You Ready?

Merchants Beware!
The busiest time of the year is here, and there is nothing quite like the holiday shopping season for merchants. The boom in sales during November and December is vital for most merchants in logging a successful year in targeted revenue. However, along with the fun and frivolity of the holiday season comes the post-holiday blues.

Reduce Fraudulent Transactions:

— Increase approval rates and reduce fraud up to 60% in online transactions by sending additional transaction data to your Processor. Make sure that cardholder information such as name, billing address, zip code, and CVV code are all being captured.

— Implement Visa Checkout and MasterCard SecureCode programs. This adds an extra level of verification to ensure the cardholder is initiating the transaction and not a fraudulent source.Use a Tokenization Service — Tokenization Service helps create a safer online and mobile payments environment for consumers by replacing a card’s primary account number (PAN) with a unique surrogate value that may be used to conduct payment transactions. Tokenization is becoming increasingly popular with Issuers and Merchants due to the security benefits it provides. Payment tokens, in particular, allow for a seamless payment journey that is transparent to the Card Members without impacting Merchant revenue continuity.

EMV Equipment should be used to process transactions at the point of sale. EMV chip cards have an embedded microprocessor chip, which increases transaction security by exchanging authentication data with terminals. This makes the chip cards difficult to counterfeit and effectively combats fraud at the point of sale.

Fraudsters deliberately target the holiday season, with more than half of annual fraud income taking place between September and December and chargeback rates increasing by up to 50% at peak shopping periods.

Merchants should implement fraud protection training with their employees to help them recognize the possibility of a fraudulent transaction. Merchants should enable the CVV match and AVS features on their payment terminals or in their software/gateway. To reduce chargebacks, merchants can offer a clear and concise Return Policy and respond promptly to customers who want a refund.

Credit card fraud is not going to go away. Thieves and fraudsters are nothing but persistent. But, this year’s holiday numbers show that retailers are taking steps to get ahead of the problem.