Three Cutting-edge Trends in E-commerce and What They Mean For Credit Card Fraud Prevention

Dec 08, 2017

The way we do business is gradually shifting towards fast, simple and convenient methods. While this is undoubtedly good for merchants and shoppers alike, it has also introduced new challenges regarding security and fraud.

Here are three trends in e-commerce, and how they’re influencing the raging fight against online fraud.

  1. Instant Gratification

These days, the one thing shoppers can’t tolerate is waiting for goods or services. Leave them hanging for a few minutes before a checkout, and they may just abandon their cart altogether. In response, e-commerce is getting faster, and merchants are working tirelessly to keep the user experience as simple as possible.

The downside to instant checkouts, however, is that many websites tend to trade off intricate but useful security measures to keep authentication light and quick. Fraudsters can therefore easily create fake accounts and make purchases with false information.

  1. M-Commerce

Smartphones account for more than half of the time spent on the internet, and it isn’t all thanks to social media. In 2016, mobile transactions accounted for 35 percent of all e-commerce transactions. Moreover, U.S. m-commerce sales are projected to reach a whopping $284 billion by 2020.

Delving into m-commerce has the primary benefit of making online shopping easier and quicker than ever. It also means you don’t have to hop on a desktop and mess with LAN, as you can now send a gift or order groceries while waiting in line for brunch. On the other hand, because many mobile users lack transaction history, it’s difficult for a merchant to trace any user abnormality. Detecting fraud, therefore, requires a real-time risk assessment, especially with on-demand purchases.

Nevertheless, utilities like biometric systems, GPS, and SMS verification are making it easier for merchants to authenticate payments without adding friction to online transactions.

  1. Multi-channeling

The growth of m-commerce doesn’t mean that customers are abandoning their computers in favor of five-inch screens. In fact, the average online shopper completes transactions from at least two different devices using various payment channels, including credit cards, debit cards, and PayPal.

A merchant that allows customers to jump from one channel and device to the next benefits from keeping them satisfied all through the checkout process. However, identifying who your shopper is and whether a potential of fraud exists can be challenging. Multiple channels mean more payment options, which in turn increases complexity concerning fraud management. Rules and regulations also vary between forms of payment, meaning fraud can shift from one channel to another.

Providing multi-channel payment processing while combating fraud requires a consolidated fraud-management service, which can handle customer data from multiple channels while offering robust credit card fraud prevention.

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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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