Ringing in the New Year by Reining in Fraud
The new year is a time of new beginnings, and subscription businesses should take this opportunity to reexamine their strategies for combating CNP fraud. Whether accepting orders that are fraudulent (which often results in chargebacks) or denying legitimate orders on the mistaken belief that they may be fraudulent, merchants stand to lose a lot of money if they aren’t able to effectively mitigate fraud.
In fact, all signs indicate that fraud is only going to get worse, regardless of the time of year. One study estimated that fraud rates in 2019 would increase by as much as 29% over the previous year. This same study found a 60% increase in suspected e-commerce fraud from 2017 to 2019. Another study, from Juniper Research, predicted that retailers could lose up to $130 billion over four years (2019-2023) in sales revenue from fraudulent card-not-present (CNP) transactions (as reported in RetailDive).
The linchpin of an effective CNP fraud prevention strategy is the use of a sophisticated, dedicated, automated, and up-to-date fraud solution. Such a solution should:
‘set and forget’ configurations
, automatically denying those transactions that meet the criteria set by the merchant
so the business can
from high-risk countries, for example, or from high-velocity attempts (such as multiple sign-up attempts from the same credit card), or based on any other unique requirement relative to a specific industry or market segment
artificial intelligence and machine learning
for the most sophisticated, fast, and effective identification of fraudulent transactions and patterns
other cutting-edge features
, such as 3D secure for authenticating a buyer’s identity
In their study, Juniper Research suggested that many merchants aren't adopting prevention solutions because they may see them as costly, without a quick and adequate return on investment. But Recurly can attest to the undeniable value of a dedicated fraud solution.
Subscription businesses which have in place an effective fraud prevention solution will benefit in a variety of ways. They’ll….
by minimizing chargebacks and by preventing e-commerce fraud and unauthorized account creation
Eliminate manual reviews
of suspicious transactions, reducing operational and personnel costs
Accept more orders
with confidence, knowing automated processes are at work to protect your business
Recurly is one of the only subscription management platforms on the market today that includes an integrated, comprehensive fraud prevention solution. Our solution is powered by Kount. Talk to a Recurly expert at (844) 732-8759 to learn more.