As summer heats up and people are heading off on vacation, buying graduation gifts and enjoying more leisure time, this season presents more opportunities for your small business to thrive. It also presents more chances for e-commerce scammers to strike.
In the case of chargeback fraud, banks are taking extra steps to ensure consumer safety and loyalty, while the merchant is getting the short end of the stick. These institutions may even encourage their consumers to avoid NSF fees by claiming that certain transactions are unauthorized.
What’s a merchant to do when a buyer makes a purchase and then claims he or she never received it or says he is shipping back a defective product but the merchandise mysteriously gets “lost in the mail”?
The following tips can help you prevent e-commerce fraud and limit the amount of dishonest transactions and chargebacks.
- Verify the customer’s order by sending a confirmation email before the transaction is complete.
- Make sure your company name and phone number is clearly listed on the customer’s credit card statement. Oftentimes, consumers will dispute a charge if they don’t recognize the seller’s company.
- Highlight your company’s contact information and make sure you provide excellent customer service. If you make it as easy as possible for a buyer to contact you should an issue arise, this discourages them from calling their bank to initiate a chargeback dispute.
- It’s been thought that Internet fraud often occurs late at night, so be wary of those purchases that take place in the wee hours of the morning.
- Be suspicious of orders shipped to the same address but using several different credit cards.
- Use an Address Verification Service (AVS) on all online transactions to verify the billing information the customer provides in the order with the information that is on file with the issuing bank.
