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How to minimize risks involved with a Merchant Account
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As a
merchant account holder, you may incur fraudulent transactions and face high risks.
Though you cannot completely avoid these risks, with certain precautions you
can definitely minimize them.
These frauds can lead to excessive chargeback rates and the
bank in turn may close your merchant account.
Here we give you a quick checklist of what you should do to
minimize fraud with your merchant account.
- Check, and recheck the order. If you find any discrepancy
in data submitted by the customer, stop the transaction.
- If you are a retail merchant (card is present), then
take a minute to scrutinize the card that a customer hands
over to you. Check the expiry date, compare signatures
on the card with the one on your bill and in case of a
photo card check if it's the same person.
- Address Verification system or AVS is a very potent
tool in stopping fraud. It may not completely foolproof
but is still handy. AVS compares the billing address submitted
by the customer with the records of the credit card issuer.
- If you are an e-commerce or an internet merchant account
holder, be extra careful. In case of a suspicious transaction,
ask the customer to send you a copy of their credit card
or photo I.D.
- Whether you are an Internet merchant account holder
or not, be careful when you get large orders or bulk orders
of a single product from the same credit card.
Use the above-mentioned checklist and closely scrutinize every
transaction. You will be way ahead in minimizing risks with
your merchant account credit card transactions.
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