As a small business owner, you are likely always looking for ways to keep your business safe and secure. One of the biggest threats to your business is payment fraud. This type of fraud can cost your business a lot of money, and it can be difficult to recover from.
What is Payment Fraud?
Payment fraud is any type of fraudulent activity that involves the use of payment information. This can include credit card fraud, ACH fraud, check fraud, and more. Payment fraud can be committed by anyone, from an individual with a stolen credit card to a large criminal organization.
Unfortunately, small businesses are often targeted by payment fraudsters. This is because small businesses are less likely to have the same level of security as larger businesses. Additionally, small businesses may not have the same resources to devote to fraud prevention. If somebody pays for items in your business with a fraudulent credit card, you may be held liable or you may not receive the money. For this reason, it’s important to take steps to prevent payment fraud.
Preventing Payment Fraud
The good news is that there are some things that small businesses can do to protect themselves from payment fraud.
Learn to Recognise Fake Cards
To start, you should learn to recognise fake cards. This can be tricky, as counterfeiters are getting better and better at making fake cards that look real. However, there are some things that you can look for. For example, look for signs of tampering, such as oddities in the raised print or holograms. You should also make sure that the card’s expiration date and CVV code are valid.
If you’re unsure whether a card is real or not, you can always call the issuer to verify.
Use AVS and CVV Verification
Furthermore, you can protect your business from payment fraud by using AVS and CVV verification. What does this mean? AVS stands for Address Verification Service, which is a system that checks whether the billing address provided by the customer matches the one on file with the card issuer.
On the other hand, CVV stands for Card Verification Value, and it is the three- or four-digit code on the back of a credit or debit card that is used to verify that the customer is in physical possession of the card.
By using both AVS and CVV verification, you can be sure that the person making the payment is the actual cardholder. Of course, this doesn’t guarantee that the card isn’t stolen, but it’s a good first step in preventing fraud.
Adopt an Effective EFTPOS System
In terms of security, you can’t go wrong with an EFTPOS (Electronic Funds Transfer at Point of Sale) system. This type of system uses a PIN (Personal Identification Number) to approve transactions, which adds an extra layer of security. What’s more, they take payments from EMV chip cards, which are much more difficult to counterfeit than traditional magnetic stripe cards.
What’s the difference between EMV chip cards and magnetic strip cards? EMV chip cards are equipped with a tiny computer chip that generates a unique code for each transaction; this makes it much more difficult for fraudsters to create counterfeit cards.
If you’re looking for a more secure way to take payments, an EFTPOS system is a great option because it also comes with an integrated POS system where you can manage inventory, track sales, and perform other tasks. Whether you choose the cheapest EFTPOS machine for small businesses or a more advanced option, you’ll be able to take chip cards, contactless payments, and even mobile wallets like Apple Pay.