The Best Ways for Merchants to Avoid Fraud

Feb 13, 2015

Fraudulent charges and hacking can happen to the best companies. While many think that they are just prone to these issues, they are not. True, high risk merchants have a higher risk of incurring fraudulent charges, but there are things that every business can do to avoid fraud. While many of these things are common sense, many are not, and you may be surprised at how easy the process can be.

First off, update your security! This should be commonly done in your business, as most security programs expire after one year. You need to also make sure that your merchant account processor also updates security features on their end, to help protect from fraudulent issues.

Also, you need to know who you are sending to. Many times, a domestic credit card with a foreign address or PO Box can result in a fraudulent charge. By sending to only home addresses in the USA and Canada, you are eliminating some of the threat.

Make sure that your return and cancellation policy is clearly stated. Often a miscommunication or misunderstanding can lead to a chargeback. A chargeback is what happens when an item is returned, an order is cancelled, or fraudulent activity occurs. Chargeback fees can be upwards of 270% of the original charge – which can quickly add up. You also need to invest in chargeback insurance. Chargeback insurance, while it cannot eliminate all chargebacks, it can help you vet potential chargebacks, to week out scams and legitimate purchases. Chargeback insurance can also keep chargeback fees low, which is a good thing for you, your customers, and your merchant account processor.

Not all merchant account processors offer chargeback insurance. One of the top-rated is EMB. With EMB, you can obtain chargeback insurance in as little as three business days! This is record speed, and the service is fantastic to boot. For more information about obtaining chargeback insurance, contact us today.

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Having a merchant account allows an account holder to take advantage of merchant cash advances. When a merchant is approved for an advance, the business agrees to receive a lump sum of cash in exchange for an agreed-upon percentage of future credit card sales.

Pricing varies depending on the merchant’s industry, past credit card processing history, the type of business seeking the account, average ticket sales, and average transaction volumes.

Yes, EMB works with merchants who are building their credit, as well as those who have poor credit. EMB also approves merchants that have no credit card processing history and businesses that have lost their merchant accounts due to high chargebacks.

Several factors influence a merchant’s risk level. Though only one factor likely will not get a merchant classified as high risk, a combination of these may: business size, location, and industry, credit score, credit card processing history, a industry’s reputation for excessive chargebacks, a prior history of high chargeback ratios, and whether a merchant exclusively sells online.

Virtual terminals are stationed on a merchant’s website, making it easy for customers to make a payment or purchase online. Merchants or a payment processor can easily set up virtual terminals, so online businesses can accept credit and debit card and e-check transactions.

A merchant account is a business account with an acquiring bank. Without this business account, which actually works more like a line of credit, a merchant cannot accept and process credit and debit card transactions. Businesses need a merchant account to accept major credit cards via a static point-of-sale terminal, mobile card reader, or through a virtual payment gateway.

After filling out EMB’s simple online application and submitting any necessary, requested documents, many merchants get approved within 24 and 48 hours.

EMB specializes in working with high-risk merchants. EMB works with many merchants, including but not limited to businesses in these industries: gambling and gaming, adult entertainment, nutraceuticals, vaping and e-cigarettes, electronics, tech support, travel, high-end furniture, weight loss programs, calling cards, e-books and software, and telecommunications.

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