If you are in the mail order or telephone order or e-commerce business it is crucial that you take precautions against chargebacks and unauthorized transactions.  If you do not it could cost you dearly because the burden of proof is on the Merchant when it comes to disputes.

The problem is what can merchants do to protect the security of their online sales? One suggestions is insisting that customers use the CVV number; a security feature on credit cards that is a three or four digit number found on the back of the card. the system will ensure the CVV code put in by the purchaser matches the credit card code. If it matches your purchase is processed, if it doesn’t match the purchase is not put through. This system isn’t without problems, if a credit card has been stolen the thieve will easily find the CVV number and can make a purchase with your card. It is an added security measure but not the only thing you should do.

A second security measure to put in place is the AVS, address verification service. This is offered by major credit card companies and is a great way to maximize security. This service will check that the billing address the purchaser puts down on the transaction is exactly the same as what the bank has on file. Again sometimes fraudsters can figure out your mailing address and can go through this security measure with no issues. This service does eliminate many stolen credit card transactions and is an easy precaution to take in order to reduce your fraudulent transactions.

For the tightest security around you should use a sign-on-delivery service with ID verification. Coordinate this with your shipping company and you have a secure online option for your business.

Having a merchant account comes with added responsibilities and not following the proper rules can land you in hot water.  Be sure to follow the tips laid out in this article to help reduce chargebacks and potential fraud committed on your company.