Home » Top 5 Tips for Payment Risk Management in the USA

Top 5 Tips for Payment Risk Management in the USA

Nowadays, almost any business has its own website, through which it can accept electronic payments for services and goods. Along with the growth of online shopping, the number of crimes related to deceiving merchants and their customers, theft of personal information, bank cards, and accounts has increased. Some areas are particularly prone to fraud and need a heightened level of safety. Learn about the ways of protecting your business and customers with high-risk payment gateways, device fingerprinting, and more.

Types of Risks

The key to choosing the right measure or a combination of several methods is to understand and assess the potential risks. As a merchant, you should be aware of possible threats, why they occur, and how to detect them. Among the frequently encountered frauds in e-commerce, the following can be highlighted:

  • Chargeback fraud: Any client has the right to demand a chargeback if they are not satisfied with the service. Scammers use this opportunity for selfish purposes, for example, to get goods and not pay for them. A subtype of it is the so-called friendly fraud.
  • Card-not presented fraud: The number of transactions where a cardholder is not personally present when paying for products online has almost doubled over the past year. It is actively used by fraudsters, stealing card data and using it at their own discretion.
  • Phishing: Scammers often create fake websites or send emails copying your design to trick users into entering data from their accounts and gain access to all confidential information.
  • Synthetic identity theft: Sometimes, fraudsters mix the stolen information about real customers with fictitious data to create a new “identity” and commit illegal actions on behalf of this person.
  • Triangulation fraud: In this situation, fake services are used, where visitors can purchase goods and services at incredibly low prices. Scammers collect data from customers and use it for their own purposes.

Of course, it is not a complete list, and each scheme can have several variations. All of the above causes financial and reputational damage to your company. Fixing errors and restoring your customer base can be very costly and time-consuming.

High-Risk Businesses

Banks regard certain areas as high-risk since they are highly likely to face various fraudulent schemes. Each financial institution puts forward different evaluation criteria. But usually, before registering merchant accounts, they study your credit history, the geography of your services, previous experience, reputation, and so on. Traditionally, there are specific industries that fall into the high-risk category, for example:

  • Alcohol and tobacco products;
  • Sports betting and gambling;
  • Products and content for adults;
  • Hotel business and tourism;
  • Medicines and vitamins;
  • CBD and its derivatives.

If your business falls under the definition of high-risk, it does not mean that you conduct some illegal activities. Banks and financial organizations just try to protect themselves from possible risks and place increased demands on such companies.

How to Avoid Risks?

Fortunately for business owners, there are modern anti-fraud solutions. Below are the main methods you can use to keep your company and customers safe.

Payment Gateway

Payment gateways allow merchants to accept payments from clients around the clock, wherever they are. Reliable services provide verification and encryption of banking data and prevent theft. Moreover, thanks to their use, you can take payments from cards of any system (Visa, UnionPay, MasterCard, etc.) and in any currency, which makes your company inclusive. Also, good service providers offer quality support and help you deal with any issues that have arisen in a short time. Additionally, they give various ways of business protection against fraudsters.

Chargeback prevention

Protection against fraudulent chargebacks includes a variety of methods. First of all, you should post clear descriptions of goods and services on your site and also tell the visitors about the refund policy in detail. Provide a reliable and timely delivery system for your products. Also, you can use an alert system that informs you if a customer has requested a chargeback. You can quickly check this information, and if the request comes from a suspicious person, suspend the shipment of goods.

Device fingerprinting

As a preventive measure, you can use device fingerprinting technology. Its essence boils down to analyzing data, configuration, and apps installed on a visitor’s computer or smartphone. This technology responds to a set of triggers (for example, ad blocking apps or anonymous browser sessions) and helps identify fraudsters before they do anything illegal. With today’s technology, changing a device’s fingerprint might be tricky. Many leading businesses have effectively used the described method to predict the likelihood of identity theft or bank card information.

KYC Solution

It is another option for protection against fraudsters, which allows you to find untrustworthy customers at the initial stage. The complex of KYC measures includes several steps and aims to analyze personal data about an individual or legal entity. After a thorough check, you can tell about the reliability of a particular client and decide on the conclusion of a contract with them. Such actions help prevent money laundering and other fraudulent activities. Modern solutions offer automated analysis of information and constant monitoring of changes.


All providers of services that accept payment electronically, and, therefore, process, store, and transmit bank card data, should be PCI DSS compliant. This certificate guarantees the security of confidential information from outside interference and theft by unreliable company employees. The established standards control data protection, implementation of access control, vulnerability management, regular monitoring, and elimination of problems. If an organization that accepts online payments misses the annual certification for some reason, it can receive certain sanctions and fines.

Make Online Payments Safer for Your Customers

In addition to the global solutions described above, there are many other measures to help you minimize risks and avoid scams. For example, setting up two-factor authentication on the site, using the SSL protocol, regularly updating the software, using back-ups, and much more. An integrated approach and the use of several methods at once make any high-risk business more secure.

About the author


Shelly is an avid reader, and the love of reading takes her to content writing eventually. She loves writing on various topics.

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