Whenever someone make a purchase on an e-commerce website, they can opt to pay by credit card. Since they are not physically at the merchant’s location, their credit card cannot be presented for visual inspection. This is known as the Card-Not-Present payment.
Issues with Card-Not-Present payments
For a merchant, allowing Card-Not-Present payments comes with a higher risk of being defrauded. No doubt you’re making it easier for your customers to buy stuff remotely but you could just as easily lose tons of money to fraudsters.
If your customer made a purchase using a stolen card, you could end up being slapped with a chargeback request by the real owner. That’s a lot of money down the drain as you would have to pay for the chargeback penalty and refund the purchase amount. A heavy blow for sure because you would have already shipped the items purchased to the customer.
Occasionally, you’ll get a dishonest buyer who wants to buy your products but is not willing to pay for them. They will order items from your online store, frequently these will be high-valued goods, then make payment using their own credit card. Upon receiving the goods, they then proceed to file a chargeback claim saying that they never received the goods or the items were defective. Credit card issuers tend to side with the claimant so you will have lost your revenue as well as your products.
Mitigating the risk of card-not-present transactions
At FraudLabs Pro, we believe in giving the power back to the merchants to detect fraud easily while still earning good money through online transactions. Our Micro plan allows merchants to screen up to 500 orders free of charge per month.
If your online store is in our list of supported shopping carts below, you can just install our fraud detection plugin and be protected from payment fraud with just a few clicks.
With FraudLabs Pro, machine learning is used along with blacklists data contributed by our global merchant network to provide a robust and reliable mechanism to unveil fraudulent orders. In addition, our fraud detection algorithm can perform checks on IP geolocation, proxy server, email address, shipping address and so much more.
Last but not least, FraudLabs Pro gives you the ability to customize rules to flag orders for review or reject them outright. These combinations of features make FraudLabs Pro a highly valuable partner in combating payment fraud.
Feel free to sign up for the FREE Micro plan and experience our fraud detection first hand!