This past Black Friday saw the highest volume of online traffic in history. This trend is predicted to continue in the years to come, as consumers are exchanging long lines and toy grabs for the convenience of shopping online. But along with this convenience is the surge of online fraudulent activity. Merchants that sell merchandise online must protect their websites and customers from online fraudsters. Not only will diligent fraud prevention protect your customer’s information, it was also protect your business from chargebacks.
Chargebacks91, a Tampa-based chargeback-management firm, recently released a partial report of all U.S. cities with the highest chargeback rates. Merchants that operate in these areas, or who have a large amount of clientele that live there should be on the lookout for suspicious activity. Thus far the report shows that the East Coast has the highest chargeback rates. In first place was New York, with Port Washington’s chargeback rate reaching 17 percent. 15 percent of chargeback came from Astoria, N.Y., followed by Plainview, N.Y. (13 percent). In addition, a handful of towns reached 12 percent (Point Pleasant Beach, N.J.; Danvers, Mass.; Massapequa, N.Y.; Carteret, N.J.; East Elmhurst, N.Y.; and Philadelphia, Pa.)
Tim Russo, a leader for fraud prevention company Cleverbridge, warns online merchants of the impending increase in fraudulent activity and chargebacks. His fears seem supported. Countries that have migrated to EMV have seen a significant increase in online fraud. In 2005, the UK shifted to EMV. CNP fraud has since increased by almost 40 percent in 10 years. In Australia, CNP fraud jumped 20 percent in only 2 years after implementation.
Businesses must be active participants in fraud prevention. Merchants must equip POS terminals with chip-and-signature or chip-and-PIN to protect themselves from liability if card-present fraud happens. Those online must invest in software to monitor and track transactions.
High chargeback rates will rob a business of its profits. Is your business prepared for this new type of criminal? Take a proactive approach to chargeback prevention. eMerchantBroker offers high quality merchant systems to prevent chargebacks. EMB offers Chargeback Shield, a program that reduces the frequency of chargebacks by 15-30%.