Running an online business is often exciting and fun. Who has visited the website today? What did they look at? Did they sign up for the newsletter, or were they a new customer making a purchase?
Companies must temper their excitement though, because new customers require screening to validate who’s the real deal and identify imposters signing up fraudulently or pretending to be someone else. As online businesses discover, not everyone has good motives and the internet has reminded them of this universal truth.
Accordingly, here are three simple ways to screen customers to prevent getting a string of losses in the rush for expansion.
Use Payment Protection Systems
Companies can use payment protection systems incorporated into payment gateways to provide ID protection. While organizations like PayPal don’t always provide the kind of absolute seller protection that is expected or needed, credit card companies and banks are different. With over $6b in payment card fraud in 2018 alone, it has become necessary for financial companies to better protect themselves.
Address verification is one system that they’re using, but this is often combined with checking the CVV code on the back of the bank card. Device fingerprinting or verification via phone email addresses or two-factor authentication adds additional layers. While no one system may be perfect – an ID thief may have obtained some of that confidential information – they usually won’t have access to all of it. Therefore, with every new security layer added, fraud is reduced significantly for companies on both sides of the transaction.
Access ID and Verification Screening
For companies with apps or websites needing to clarify the identity of the customer, how do they do it? Of course, not all companies will be billing for services or products immediately, but it’s still nice to begin the verification process. This way, greater access to various facilities online or in an app can be made available once a user is cleared through to certain levels.
Cognito provides ID and verification screening to help app and site developers verify visitors or new users. Only a name and a phone number are required to get the process started. Cognito can also cross-reference with an SSN, address, or date of birth as additional verification points. This solution is ideal to clear new users through initial verifications without needing to process a financial transaction first.
Go Old School with a Passport and Selfie
Financial companies are often resorting to requesting a photo of their passport. And that’s not all. A recent selfie taken while holding up the passport (to fit both the person’s face and passport into the same shot) is often requested too.
Factual informational checks combined with the immediacy of a government-issued ID like a passport provided in a selfie for better confirmation can reduce the chances of ID theft. Unless disguised, it’s difficult for an ID thief to confirm they look like the person they’re impersonating. And when combined with other ID information checks, it allows online sites to be far more certain as to whom they’re dealing with.
Online business transactions with both the person and ‘card not present’ adds to the fraud risk. However, when using a combination of approaches to handle this, it’s possible to end up with more assurance than when dealing with someone in a retail store. Companies transacting online must use protective measures by identifying new users as a high priority early on in the process.