How to minimize risks involved with a Merchant Account

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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