The Importance of Cross-checking the Authenticity of Online Credit Card Transactions

Online Credit Card Transactions

As a result of advancements in technology, e-Commerce platforms exist that allow businesses to sell products and services on a global level. But, along with the positive aspects of selling online comes a negative factor that has the potential to lead an online business down the road to disappointing growth and lost revenue.

The issue of fraudulent online transactions, which has been increasing exponentially with e-Commerce growth, is a significant problem faced by online merchants. Thus, online merchants need to be vigilant about detecting the use of stolen credit card details and misuse of the chargeback system. Monetary losses due to chargebacks alone can have serious consequences for merchants.

So, how does an online merchant protect itself from fraudulent transactions? The best way is to cross-check orders. Cross-checking involves verifying cardholder information provided by the buyer according to the basic rules prescribed by The Payment Card Industry Data Security Standard (PCI DSS) and keeping watch for unusual or suspicious activity.

Carefully Observe Buyer Behavior

It’s not as easy to observe buyer behavior online as it is when purchases are made in-person; however, it can be done effectively. The first step is automatically taken when cardholder information is verified by a payment processor at the time an order is placed. Merchants need to take this a step further by scrutinizing orders for signs of suspicious activity during the fulfillment process.

Signs of suspicious activity include anything out of the ordinary, like unusual order sizes, frequency of orders from the same buyer, different billing and shipping addresses, subsequent attempts to resubmit an order using different cardholder details after being declined, and multiple orders to the same delivery address using different credit cards. Sometimes a call placed to the buyer is all that’s needed to clear up any questions and confirm an order.

Cross-checking means it will take a little more time to process some orders, but considering the consequences of a possible fraudulent transaction it can be worthwhile.

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