Online fraud is on the rise, particularly with the mobile devices customers increasingly use to make purchases. If you run an e-commerce site, your business is at risk of losing money by shipping merchandise or providing services to someone who provides stolen or fake payment information. Even using established platforms like Amazon doesn’t guarantee against fraudulent activity, since criminals have become experts at disguising their activities.
However, Amazon’s new identity-verification feature may give businesses an additional layer of protection. The company recently applied for a patent for a feature that will let customers pay using a selfie or short video. For sellers with their own e-commerce sites, sophisticated identity-verification methods may be too expensive. However, there are identity-verification tools that you can add to your e-commerce site to protect your business against fraudulent transactions. Here are a few reasons you should put identity verification in place.
Build Customer Confidence
Simply seeing that your site is taking precautions to protect against fraud is enough in itself to build confidence in your brand. This is important to online shoppers, some of whom are still hesitant to hand their payment information over to a business. Multi-factor authentication can be a way to instill that confidence while also protecting your bottom line.
Address Increasing Risks
As more consumers gravitate toward mobile devices for their online activities, businesses must find more inventive ways to address fraud. Now that brick-and-mortar shops have switched to chip-based credit cards for added security, experts expect criminals to move to online fraud as an alternative. Additional measures will offer your customers a higher level of security than many of your competitors.
Keep Prices Low
Fraud drives prices up for honest customers, hurting the market as a whole. If your business loses merchandise due to bad transactions, you’ll eventually have to raise your prices to compensate for those increasing losses. When you have extra security measures on your site, you reduce the risk of those losses and protect your current prices. If your competitors are always upping their own prices to make up for fraud, you’ll likely find that customers choose your brand over all others.
Ensure Packages Are Properly Routed
Address verification is one of the most popular forms of identity verification, primarily because it is often built into payment processing software. When you verify your purchaser’s address against the billing address, you can also catch errors. A customer can easily mistype an address, which will cause the package to be misdirected. By displaying an error when the billing address doesn’t match the one on the billing statement for the card, your software may catch those few instances and expedite the package to avoid a bad customer service experience.
Online fraud will likely always be a problem for e-commerce sites, but as fraudsters grow more sophisticated, experts will continue to come up with innovative ways to stop them. Tools like identity verification and multi-factor authentication are a great way to add extra security to your site without inconveniencing the customers who buy from you.