How to safeguard your sole proprietorship from credit card fraud

Credit fraud and cybercriminals are a reality that not only affect large multinational companies, but they can also affect small businesses. So if part of your day-to-day business requires using credit cards for payment, you must pay attention to credit card fraud and how it can affect your company.

Your business reputation is also at stake here, so it adds more importance to be aware of any possible signs that you may be a victim of cybercrime.

Chip Readers

Counterfeit banknotes are not the only way fraudsters can attack, they’ve created counterfeit cards too and this method is becoming dangerously popular in stores everywhere, well, except when people use chip readers.

This is an enhanced technology, stronger and more theft-proof that the usual magnetic stripes of regular credit cards. As a plus, merchants will not be held liable for credit card fraud, if they use chip readers.

AVS (Address Verification System)

This is a systems security tool that both banks and credit card companies use. The way it works is by matching some numerical parts of a customer‘s address with the information that is on file, it is very helpful for when merchants make authorization requests to the bank. A full AVS match means less risk when processing the transaction.

Secure your network access

Always trust encryption techniques. Don’t let all your employees have access to sensitive data. Keep your business software updated at all times and also use anti-malware software.

Gaining knowledge on this matter can make a substantial difference to the way in which you can handle a possible cybercrime happening in your business. If you wish to improve your knowledge, read documents about how malware is used and how it works and what types of malware are the most common.

Finally having good habits to secure your information is a must. For instance, all of your business passwords should be complex enough by using lower and upper case letters and two-factor verification.

Stay alert for unusual customers

There are a few signs that can mean red flag for uncommon customer behaviour, including:

  • Customers in a rush to complete the transaction at a closing time.
  • Buying too many expensive items.
  • Purchasing unusual items like different sized clothes

This does not mean that all of these actions will undoubtedly mean that cybercrime is about to happen, but fraudsters do use some of these fake actions to commit their crimes.

Get familiarised with the use of tokens

Tokens are an electronic way to replace numbers. Payments made through Apple Pay or other renowned merchants use tokens so they won’t compromise sensitive numerical data, like your credit card numbers.

This can be highlighted by purchasing tokens with is equivalent to the deposit through a third-party company and the merchant to be responsible for the security of the transactions such as PayPal and SagePay.

Cybercrime is not the only crime

Even though cybercrime is a real threat, don’t neglect all the other possible forms of fraud available. Here we have a few that small business owners struggle with the most.

  • Overpayment scams: when somebody overpays for something and then seeks a fraudulent refund from you.
  • Invoice fraud: paying a bogus invoice for non-existing services
  • Fraudulent Employees: some unreliable employees may use customer’s credit cards for their own benefit.

Always report fraud on time

Regardless of all the security measures, new fraud ways are created on a daily basis, meaning that you can’t completely prevent this from happening. What you can do is staying alert of any possible fraudulent action taking place and report it immediately.

Misuse of money can affect anyone and even the largest institutions can be unreliable such as banks with previous mis-sold PPI. Furthermore, being vigilant on any suspicious activity on the credit card will allow you to become more financially secure.

We know that owning a business is the most important project a person can have, so if you are already a business owner, then take ownership and look to protect your interests from any possible form of fraud. Follow these guidelines to achieve some peace of mind and to be able to focus on making yours a successful and secure business.