An online business has its entire survival hinging upon the efficiency and safety of its online processes. E-commerce merchants face down the threat of cyber-crimes, digital scams like identity theft and credit card fraud, all too often. They also understand that if their business faces one too many charge-backs, fines or a high-level security breach, they could face serious loss of reputation, resulting in significant financial losses. For small businesses, just kicking off their operation, such losses can result in detrimental damages. Therefore, it is essential for online businesses to understand the kinds of fraud that they are vulnerable to and the sort of fraud prevention tools that are available that can help them to avoid any kind fraud altogether.
The Landscape of Online Fraud Today
Online fraud and digital scams nowadays have reached a threshold where both businesses and consumers are gravely concerned about it. According to reports, in 2019 online fraud has ended up depriving businesses and consumers of over $100 billion. Consumers, in general, believe that businesses ought to do more by way of protecting their users from fraud.
There are a number of different types of fraud that plague the e-commerce industry including payment frauds like identity theft and credit card fraud and scams like business email compromise or BEC. In BEC scams fraudsters build and use elaborate business profiles to trick customers into making payments to their accounts. Online businesses also face cyber attacks due to poor online security, wherein criminals end up compromising hordes of valuable consumer data.
There are, however, a few techniques online businesses can use to make their payment systems and web presence more secure.
Register Your Company and Logo
The first and foremost step towards securing your online business is to register it. Since online businesses do not have a physical presence that their customers can visit or refer to. Registering your company and logo can ensure your customers that your business is legitimate. Moreover, it also guarantees that a fraudster will not be able to scam users using your company’s name or logo. All legal advisors, as well as governmental bodies, advise companies to register their intellectual property to prevent any kind of fraud to either their businesses or their customers. On the plus side, it can also help you to limit your competition by eliminating knockoffs and infringements.
Use SSL for Your Website
You may often see these days that browsers tend to block or limit access to websites that use ‘http’ instead of ‘https’. The ‘s’ denotes that the website uses a Secure Socket Layer or SSL technology that builds an encrypted layer between the website and the browser. This technology helps the online retailer to secure the sensitive financial data that customer shares while completing a transaction. Any other information shared by the customer also remains safe due to this added level of encryption. This gives your customers a piece of mind that you are using a secure to conduct your business.
Use Secure Payment Channels
Online payment channels may very well form the core of an online business’s operations. They need to be fast, secure, accessible and user-friendly. Thus it is important for an online business to ensure that the payment channels they use are safe and secure, more than anything. The Payment Card Industry that includes Visa, MasterCard and American Express, implements a set of standards that online businesses have to fulfil before they can use their offer payments to customers through them. These standards, also known as the PCI compliance is compulsory for any online merchant offering its customers payments through MasterCard, Visa or American Express.
Use Advanced Fraud Prevention Tools
High tech tools that are using technologies like artificial intelligence (AI), machine learning, deep learning and big data analytics are now available for businesses to detect and prevent credit card fraud and identity theft. One such system is the transaction monitoring system wherein an online retailer can monitor each and every one of their transactions through an automated process. The system alerts the management or the sales staff if it detects a suspicious transaction. If the address of shipment comes from a suspicious location or country, or if the connection is not secure or the customer is using an anonymous email, the system will automatically issue an alert.
Another effective way to ensure if your orders are secure is to make sure the customer is using legitimate credentials, is an online identity verification and address verification system. At the time of payment or before the customer completes their order, the online merchant can request for proof of identification through document verification and then authenticate the identity of the customer through a facial scan. An address verification system or AVS verifies a customer’s address from their recent utility bill against the one listed in their credit card details.
Keep a Secure Online Interface
Keeping a secure online interface is the bread and butter for an online retailer. They must make sure that they are using updated software and operating systems. Software providers tend to update their software in order to include more and updated protocols for fraud prevention and malware protection. Additionally, they must also use a robust, enterprise-level anti-malware and anti-virus software that can thwart any cyber attacks to your system. Keeping the software up to date is also important.
The Takeaway
The amount and frequency of digital scams and frauds an online business has to face may very well determine its future. It is important for e-commerce businesses to ensure their customers that they are going above and beyond to protect their data and ensure their online safety. It is important for online merchants to use appropriate tools to prevent credit card fraud and identity theft. There are advanced yet affordable solutions available in the market that can enable e-retailers to implement tech solutions without investing in costly hardware or designing complicated software systems.
