For every type of credit card fraud, there must be a different fraud detection technique. If you’re a small business owner, you should have a plan in place to ensure the security of your customers’ data and information. With so many different fraud detection services, you need to know what to look for. These are some of the top detection techniques used to prevent credit card fraud and protect eCommerce businesses.
- Finding a solution that includes predictive analytics is essential. By tracking patterns and trends using data from payment transactions and consumer profiles, merchants can more effectively protect themselves from credit card fraud. While it’s not completely foolproof, predictive analytics can reveal what type of fraud might happen.
- Using software to analyze data is necessary, but so is human interpretation. That’s why businesses often use an expert fraud analyst. With the ability to look at the context surrounding a fraudulent case, fraud analysts can keep up with current trends and develop new ways to combat fraudulent activity.
- Tracking historical data is very useful, but you must keep up with new patterns that aren’t trending yet (i.e. finding a solution that is dynamic and flexible so that you can catch emerging fraud methods that haven’t completely surfaced yet).
- Much of the fraudulent activity in the U.S. actually comes from countries like Hong Kong, Indonesia, Russia, Nigeria and many more. As a result, global profiling has become a popular technique. By capturing this data, analysts can look at emerging trends from overseas that they wouldn’t otherwise see.
When considering all of these fraud detection techniques and solutions, keep in mind the needs of your specific business. If you hire a solutions provider that is too strict and consistently denies valid credit card transactions, you’ll lose good customers. Finding balance is key.