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Stop Payment Fraud from Eating Your E-commerce Profits


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Five online payments fraud prevention tips from Silicon Valley Bank to help companies limit fraud losses, minimize costs and improve customer satisfaction and confidence.

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Stop Payment Fraud from Eating Your E-commerce Profits

  1. 1. Stop Payment Fraud from Eating Your E-commerce Profits
  2. 2. 2 … but there’s a persistent and growing threat to every business that accepts payments online. You’re working hard to make your online commerce business profitable … !
  3. 3. 3 Why? • The move to EMV chip cards has made online an easier target than brick-and-mortarstores. • Criminals have easy access to potential victims all around the globe. The threat: Credit-card fraudsters love the online commerce business, too.
  4. 4. 4 The overwhelming share of losses to merchants from credit card fraud come from card-not-present (CNP) transactions, and the problem is getting worse. — Card industry newsletter The Nilson Report, October 2016
  5. 5. 5 If you take credit card payments online, you need a proactive plan to protect your business and its reputation. Start with these five steps.
  6. 6. 6 #1 Know the difference between data security and fraud prevention.
  7. 7. 7  Good data security practices protect your customers’ information.  Good fraud prevention tactics stop bad transactions that cost you money. Good data security: When you comply with PCI DSS, the Payment Card Industry Data Security Standard, you’re taking care that consumers’ personal information isn’t vulnerable to being stolen. Good fraud prevention: Identifies and stops transactions that attempt to use payment card data that was already stolen elsewhere.
  8. 8. 8 #2 Put anti-fraud tools to work.
  9. 9. 9 Be sure you have the basics:  Use an address verification system (AVS).  Require customers to enter their three- or four-digit card security code. Then bring in more advanced tactics:  Employ automated transactional risk scoring, categorizing, and resolution and post-purchase transaction management. Keep your tools sharp! • Continually review and adjust your fraud rules and parameters. • Fraudsters are always tweaking their tactics, so don’t have a one-and-done mentality.
  10. 10. 10 #3 Know what “normal” looks like so you can spot deviations.
  11. 11. 11 For example, look out for these mismatches: • Different billing and shipping addresses when expedited shipping is requested. • Different geographic locations for IP address and credit card billing address. Analyze transaction data during the purchase flow to flag deviations from the norm.
  12. 12. 12 #4 Train your employees to spot fraud.
  13. 13. 13  Educate your employees to understand the risks of CNP transactions.  Develop internal practices and policies for monitoring.  Train your team to use anti-fraud tools and tactics. But remember, fraud can be an inside job, so: • Use real-time screening that draws on payment information and anti-fraud intelligence from external sources. • Create a process that requires another level of approval for flagged transactions.
  14. 14. 14 #5 Leverage the expertise of your payment processor and other service providers.
  15. 15. 15 You’re not alone in the fight against fraud!  Talk to your payment processor and bank – they can share best practices.  Connect to resources such as fraud prevention services and software. Next steps: • Commit to an ongoing anti-fraud effort. • Stay up-to-date on e-commerce fraud trends. • Make your prevention strategy adaptive and appropriate to your business.
  16. 16. 16 Your proactive approach can help limit fraud losses, minimize costs and improve customer satisfaction and confidence – all key drivers of e-commerce profitability.
  17. 17. ©2017 SVB Financial Group. All rights reserved. Silicon Valley Bank is a member of the FDIC and the Federal Reserve System. Silicon Valley Bank is the California bank subsidiary of SVB Financial Group (Nasdaq: SIVB). SVB, SVB FINANCIAL GROUP, SILICON VALLEY BANK, MAKE NEXT HAPPEN NOW and the chevron device are trademarks of SVB Financial Group, used under license. B-16-15178 Rev. 03-16-17. SVB’s Global Treasury and Payments Advisors can share more details about supplier enablement. Need more information? Check out SVB’s Payments Trends and Insights page on