Detecting Credit Card Fraud
Three Things to Know About Detecting Credit Card Fraud
Credit card fraud is unfortunately one of the most prevalent realities in today's retail ecosystem. Both consumers and business owners are subject to data breaches and illicit transactions if sensitive customer information is stolen, which highlights the importance for merchants to protect this data.
There are multiple ways small-business owners can protect their network against a potential breach. Below are a few items small businesses should keep in mind in regards to security:
- Card data protection: While business owners would like to eliminate fraud, it’s unrealistic in today’s world. Cybercriminals can find a way to breach a network security system if they're extremely motivated. That unrelenting drive costs domestic businesses an average of $201 for each stolen record or piece of sensitive information, per organization, according to a joint IBM and Ponemon Institute study. There are things that businesses can do to mitigate a breach, including upgrading payment processing software and encrypting sensitive customer information with tools like Point to Point encryption and tokenization. Encrypted data is much more difficult for cybercriminals to obtain and fraudulently use.
- Point of Sale protection: Fraud protection today should realistically involve some type of data encryption so sensitive information is safeguarded. Updating the point of sale is one of the best ways to mitigate a potential breach since the security software is often cutting-edge and integrates with network data storage. Providing hardware that contains technology to encrypt sensitive data at the point of sale can help reduce the chances of fraud at the point of purchase. Customers want flexibility and convenience in their payment options while having peace of mind that their sensitive information is protected.
- Use analytics to spot outliers: Many payment processors provide merchants with back end reporting that tracks a high level of detail with each payment transaction. By using a reporting feature, business owners can get to know their customers better by analyzing their prior purchase history. In doing so, they can also detect any potentially fraudulent or suspicious activity and notify the responsible parties accordingly.
1. IBM, http://www-935.ibm.com/services/us/en/it-services/security-services/cost-of-data-breach/ (2014)
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