3 ecommerce fraud reducing technologies
Fraudsters are sophisticated, well-funded and persistent. The impact of their attacks can depend on how quickly they are detected and managed, underscoring the need for early and accurate prevention at the time of authorization. Smart ecommerce solutions have a variety of fraud reducing technologies to identify risky transactions, such as those inconsistent with typical buying behavior or originating from buyers with suspect prior history. These techniques can help reduce downstream expenses including loss of goods, refunds, chargebacks, representments and intangible reputational damage.
Basic fraud reducing technologies often include a set of filters and a highly configurable rules engine to help identify and screen payment card misuse. These strategies help identify three major warning signs that help identify potentially fraudulent transactions.
Atypical Purchase Behavior
Card thieves behave differently from good customers. Card velocity, address verification (AVS) and card security code (CVV/CVC/CID) filters can help you screen them out.
Payment Card Reputation
Payment card history can help inform you of the likelihood of fraud with a particular card. Prior chargeback and prior issuer-confirmed fraud alert filters can prevent fraudsters from striking twice.
Particular subsets of payment cards may present more risk than reward for your business. Prepaid, non-reloadable prepaid and international filters can help you target these cases.
You can also go beyond the basics of ecommerce fraud busting with more advanced tools that give even more insight such as the IP address/location of purchasers. Advanced fraud tools employ three techniques:
Device profiling technology gathers multiple device attributes from every user interaction to detect anomalies common to fraud. It also tracks the unique fingerprint and reputation of each device it encounters. Gathering this information can help indicate the likelihood of fraud in connection with a particular device being used to submit a payment.
IP Proxy Piercing
Fraudsters often try to conceal their true origin by routing their browsing through an IP proxy or VPN. This makes it hard to distinguish good-faith visitors from those cloaking their identity and intentions. IP proxy piercing technology exposes the true IP address of every transaction.
Determining each transaction’s precise origin is an essential part of fraud detection. IP geolocation combines with IP proxy piercing to identify the customer’s true location.