How to prevent payment fraud

Few phrases are more terrifying for small business owners than “data breach”. Even with good point of sale and payment processing systems in place, data security should be a team sport for every small business. You need to ensure that everyone who works in your organization is also working on keeping your business’ data and transactions safe.

What Is data security?

Data security is protecting digital data, such as those in a database, from destructive forces and from the unwanted actions of unauthorized users, such as a cyberattack or a data breach.

Why is data security important to a business?

Data security functions to prevent data breaches, reduce risk of data exposure, and for regulatory compliance purposes. Within any organization, data security's role is to ensure the ongoing safe and secure use of private data while minimizing exposure risk.¹

What Is payment fraud?

Payment fraud happens when someone with ill intent steals another person's private payment information. They then use that information for a false or illegal transaction.

How to keep payments secure

Elavon has a proven track record when it comes to payment security, and we have outlined four scenarios that should raise red flags for our merchant customers. Protect your profit and reputation by watching out for these types of situations.

Small transactions, big problems

Once credit card data is stolen, fraudsters know they steal a credit card, scammers know the clock is ticking so they’ll tend to make as many purchases as possible in a short amount of time. Lookout for orders with a lower than usual dollar amount or an exceedingly high dollar amount. Fraudsters will often try to authorize small transactions to make sure they have valid credit data and the potential to use the data for larger purchases. Watch out for unusually high- or low-ticket transactions and set a threshold amount that will flag or even decline strange-looking charges.

Multiple orders could be ‘out of order’

Are you getting several orders from one customer in an uncharacteristically short amount of time? That should be another red flag. While a ‘velocity limit’ sounds like something from a Michael Bay movie, it’s actually a helpful way to stop fraudulent transactions. Velocity limits set a cap on the number of transactions that can be authorized in a certain period of time. By using velocity limits to limit the transaction total amount per hour, day or week from any one customer’s credit card, you could be slowing down potential fraudsters.

Avoid a mess, check the address

People receive packages at work or often send them to a relative or friend. So a billing address that’s different from a shipping address may not always be fraud but it’s wise to double check. Use the Address Verification System (AVS) to check the cardholders' addresses against the card issuer’s database as a simple means for potential fraud detection.

Card not present?

Keep a close eye on multiple charge attempts against a single card number and expiration date where the card is not present. Hackers use data breaches and other methods to steal credit card data. Multiple charge attempts could be a sign that someone is attempting to use stolen card data without the physical card. Requiring CVV code located on the physical card is a smart and easy way to detect and stop potentially fraudulent card not present transactions.

How to keep data secure in a business

In addition to all these tips and and recommendations that can arm you against would-be fraudsters, you can also get in touch with Elavon anytime to find out more about credit card security, data protection and PCI DSS compliance validation. Our dedicated security teams are ready to help you protect your business by identifying security threats before they become major problems. Our available state-of-the-art security solutions protect data in transit and at rest with protective measures like tokenization and encryption as well as monitoring payment channels for indicators of fraudulent activity.

Call us today to find out more about educating your team on fraud, hacking, scams and more.

Find more helpful small business security tips

• How to protect cardholder data
• Mitigating fraud risk for merchants with a layered approach to security
• Tips for maintaining payment data security
• Accelerating growth for you and your business customers

Find more small business payment processing tips

• How to reduce business costs
• How to grow your business and have a life
• How to offset credit card acceptance fees
• How to use data analytics to grow your business
• 5 ways to set up your small business for success during the holidays