Fraud Prevention & Reduce Chargebacks

Online transactions are all the rage today, with more and more customers opting to make use of online transactions to buy the coveted products. As online transactions grow rapidly with each passing day, fraudulent activities have also cropped up to erode the profits of merchants in the process. For merchants, online fraud prevention and detection is the need of the hour, where diligent use of bank identification numbers data is sure to help a merchant screen a suspicious order and enhance fraud prevention measures in the bargain.

---

Bank identification numbers offer valid information on credit and debit cards, which encompass details like the brand of card to know whether it is Visa or MasterCard, type of card, and the level of card to know whether it is Gold or Classic, among the other relevant details of the credit and debit cards that gets used during online transactions. In simple terms, with the bank identification numbers, a merchant finds an ideal fraud protection measure that can throw more light on the card and its user.

But, gaining access to supplementary information that stretch beyond the six digit card numbers, equips a merchant with the needed fraud protection measure that can put a stop to suspicious transactions. By making use of the supplementary information, a merchant can enhance the risk management components by way of the data obtained through the information, which in turn helps a merchant to know if a fraudulent activity is attempted through an online transaction.

The bank identification numbers data sounds a warning bell when the country of issue is different from the country of intended delivery. To buttress fraud protection, the extensive bank identification numbers database helps a merchant to check the authenticity of questionable orders. For instance, when a card issued by a bank found in the USA is put to use to buy and ship a product to Belarus, the attempted transaction can be reviewed and screened before taking steps to complete the order process, which is the ideal way to put fraud protection in place.

---

By gaining access to an extensive bank identification numbers database that unveil records of users on a large scale, a merchant is making sure to embrace the best fraud protection measure to differentiate a genuine credit card from that of a fake card that looks similar to the original.

Keeping a check on the customer chargeback ratio is one of the significant features that demand the attention of the online merchants. High customer chargeback ration can erode the reputation and profits of a business. By cancelling transactions that reek of fraudulent activities, the online merchant is not only embracing the best fraud protection measure, but is also embracing the best measure to keep the customer chargeback ratio in check. This is made possible only when the online merchant gains access to an extensive bank identification numbers database.

By using BIN database, an online merchant can make use of a host of information to enhance fraud protection. The information includes details about the card, bank that issued the card, personal information related to the card holder, and other relevant information, which can be used to double check the authenticity of a transaction, and to know if it’s the right owner of a card who is attempting to make an online transaction. Gaining access to the bank information numbers database is the best way to enhance fraud protection measures, and to thwart duplicitous attempts made by miscreants

---

A Banks identification number (BIN) is a set of first four to six digits on a credit card, debit card, electronic benefit card or a charge card, used to identify the issuing Institution and its address, type of card and other details on the card.

Learn what you can do to reduce chargebacks and prevent fraudulent transactions when selling online. An increase in global transactions and movement of people requires critical and accurate matching information about the transactions between the merchants or card holders, card issuing institutions, and the banks being used for transactions. For example, a misunderstanding may arise where by a merchant withdraws more funds than agreed upon in the transaction, from the card of the client.
The client’s issuing bank will forcibly initiate a return of the excess funds to the owner’s bank account, credit card, debit card or charge card. A situation in which excess funds are returned to the owner is known as a chargeback. A chargeback helps reverse a fraudulent transfer. Here is method that help to lower the number of enquiries you receive and reduce the number of chargebacks.

---

1. Fraud prevention
Bank Identification numbers help to match information between merchants and their customers so as to avoid fraudulent transactions. A fraudulent transaction that involves a chargeback is more likely to affect the merchant’s business and may lead to a closure of the merchant’s account. In some incidences, criminal investigations will be launched against the business owners with possibilities of prosecution. It is internationally agreed that the customer chargeback ratio should not exceed 2.5%. A bank Identification number helps the merchant to receive notice of excess withdraws and this allows the cancelation of transactions that might be considered fraudulent. The Merchant would also be able to determine the percentage chargeback, so as to avoid a situation leading to the closure of the account.

2. Reduce chargebacks
The growth in online business has been followed by matching proportions in online fraud. There is an increase in the use of fraudulent credit cards ma situation that is likely to affect the chargeback ratios of business owners. A bank identification number will help merchants identify card holders and card issuers. The identification numbers are representative of the issuing company and the bank and this will help you validate the accuracy of the card before approving a transaction.

3. Risk Management
A number of newly opened businesses on the internet are a possible target of fraud organizations. Many tend to receive numerous orders for their good and services from these organizations and may end up making many shipments .Because most fraudulent companies use forged or stolen cards, these businesses will incur heavy losses than may possibly lead to closure and at times high risks of chargeback bank Identification Number is one way a newly opened business owner can prove the identity and accuracy of the destination of the goods. Merchants have a chance to cross check the information of the country of delivery before actually sending the goods. For example, a person credit card issued in London and sending goods to Uganda will have the information cross-checked before the goods are actually sent to Uganda.

---

If you are an entrepreneur whose business is exclusively dependent on internet transactions, you might be haunted by the possibility of internet fraud wreaking havoc on your business dealings. The threat of fraud is real; the risks are not overstated, and understandably fraud prevention must be on the top of your business agenda.

What are the possible scenarios that you can be confronted with in your day-to-day business?

Here are some typical examples:

• You have launched your website and now you are busy building up traffic to boost your business. But do you know who your customers are? Are they legitimate?
• You receive a barrage of orders for your product, a great feel-good factor indeed, but are you sure about the credentials of the credit card you are going to charge?
• You have received payment for a sold product, and now you have shipped the product. What is the risk that the card is stolen and the genuine card holder disputes the transaction?
• All your sales are online and your first payments are coming in. Are you sure about each customer’s identity?
• Now your business is moving like a breeze, apparently no issues, high volumes, and everything looks sunny. What do you do if organized hooligans with the help of stolen cards have boosted your sales?
• You have managed to succeed in this cut-throat trade, but now a jealous competitor is keen to put you out of business. The dubious competitor fakes a lot of orders; you have shipped them and now the competitor disputes all the charges. How do you wriggle out of the situation?

The above constitute only the tip of the iceberg of a potentially massive scale of fraudulent activities that are either already devised, waiting to be stealthily executed, notwithstanding addition to the new ingenious ones on the anvil in a latent phase ready to strike unsuspecting businesspersons. Internet marketing is replete with deceitful players. You need to put in place a mechanism that not only is 100 percent foolproof but also capable of plugging newer and more devious fraudulent methods that are concocted every day.

Bin Database System

Bank Identification Number database or BIN database is the most effective strategy to tackle the scourge of internet fraud.

What is a BIN?

Bank Identification Number or BIN represents the first six digits of the user’s credit, debit, or prepaid card numbers that facilitate making of each electronic transaction. The first six digits are also called issuer identification numbers (IIN). The Bank Identification Numbers (BIN) or IIN database and its membership are managed by the American Bankers Association and are updated monthly. Online merchants use BIN database to validate transactions.

Nevertheless, for the BIN database or IIN database to be effectual, it must fulfill the following conditions.

• It must be user-friendly: Professional database preferably is the best choice. Yet, there is no reason why you cannot create your own.
• It must be accurate: Fortunately, these days most trusted databases are 99 percent accurate, more so because these databases are monitored and updated regularly. Users look for databases that provide comprehensive information of the country of residence and the BIN numbers. Verification cannot be complete without all these relevant details. The obvious source to get these details is from online merchants, financial institutions, and banks.
• It must conform to the highest quality: Dependability is a must-have. It should be free from spelling errors to enable accurate automatic filtering. A BIN databases has to ensure conformity to acceptable standards, and therefore naturally instil confidence among users. Reputable databases willingly offer assistance to provide updates on a regular basis as well as provide assistance in BIN correction and also in locating unidentified BINs.
• It must be cost-effective: Typically there are different rates for bulk usages and single rates. Choose one after a careful consideration of quality and ease of use.

So what is the call? Making your own anti-fraud system could be one of the workable solutions. For that you need to collect data on Internet card processing behaviour and build up a database with a large number of different fraud models. Once you are able to do that, checking bank identification numbers will save you money. Alternatively, you can buy professionally made BIN database that has a good record of verifying credit card details, reducing chargebacks and preventing fraud attempts.

Here is how bin databases help you

• The first six digits of the BIN provide the most vital identification of the user that helps you validate an order. Most importantly, it provides the name of the issuer bank and the country of its origin. It provides information whether the card is a credit, debit, or a prepaid card.
  
  
• The database prevents you from getting trapped by fraudulent transactions. When you run a BIN through an online validation service, you have a chance to cross-check suspicious transactions and if necessary put a hold on them. In effect you can pre-empt fraudulent transactions before they get the better of you. Another great advantage is you can use the BIN in a customized way to suit your business needs. You can seamlessly integrate the credit card BIN checker with your business requirements and weed out banks having a history of shady bank transactions. Additionally, if there is restriction to export to a particular country, you can exclude cards issued from that country’s billing address automatically.
  
  
• BIN identification numbers help you charge variable fees applicable for debit and credit cards. This is especially true for cards issued from outside the USA that need to be charged extra. Even a business card has a higher charge than a personal card. With a proper merchant account, you can set an automated arrangement whereby with a BIN database lookup you can assess the exact fees that needs to be charged with credit cards.

Internet card fraud is on the rise. It would be an unpardonable act to run an internet business without the help of Bank Identification Number database. Even optimistically assuming a very low-risk scenario, the potential damage to businesses can be huge.