Go beyond simply stopping fraud

The main purpose of fraud detection technology is to detect bad customers. But, you can also use the data collected through the fraud detection process to understand your customers better – so you can sell more often and with more high-dollar transactions to good customers.

You want your customers to complete their transactions on the first attempt. Declining their transactions can lead to friction and cart abandonment. But if you have fraud under control and proper risk management in place, you can approve more good orders, decrease customer friction, and earn more revenue.

Many fraudulent transactions and high chargeback rates can land you in a monitoring program. They come with a lot of drawbacks — increased fees, added fines, and loss of payment processing capabilities, and more. Avoiding these programs will save you money and could prevent business closure.

Processors reduce fraud risks by putting limits on merchant accounts. These limits are good for processors — they reduce liability if something goes wrong with your business. If you can minimize fraud, processors may increase your volume limits. Which means more sales and more money in your pocket.

Your customers want you to care about them, especially when they build trust in your brand by opening accounts, collecting loyalty points, and purchasing your products regularly. But fraud can quickly damage that relationship. With fraud detection and prevention in place, you protect your customers and improve loyalty.

Unauthorized transactions can result in chargebacks. And chargebacks can be costly. Preventing fraud means you prevent the resulting chargebacks. And preventing chargebacks means you retain more revenue, avoid damage to your brand and reputation, avoid threshold breaches, and reduce administrative hassle.

The worst thing for your business is letting a fraud problem go viral. All it takes is one fraudster breaching hundreds of customer accounts or a few unhappy customers leaving terrible reviews. A fraud prevention platform reduces the risks of you ever seeing your company’s name publicly spoiled because of fraud.

If you have a merchant account reserve, it may be because your payment processor thinks you pose a higher risk. By keeping fraud risks down and reducing chargebacks, you can prove that you aren’t as risky as they assumed. And they might ease up on reserve requirements — thus, more revenue in your pocket.

Card brands and payment processors monitor various risk metrics, such as fraud ratio, chargeback ratio, and more. If risk levels rise too much, they could decide to stop doing business with you. Keeping fraud risks in check is vital towards maintaining a good partnership with a merchant account provider.