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Fraud is one of the biggest concerns businesses have - especially small businesses. A fraud complaint, or even customers defrauding a business, isn’t as uncommon as you might think. Here’s how to avoid trouble and keep your profits where they should be.

Accept Mobile Payments Using Wireless Technology

The best thing you can do, to combat fraud, is to keep the card in the customer’s hands. Customers that complete the transaction themselves reduce your risk of a fraud complaint. Also, reducing your over-the-phone orders reduces the risk of fraud, and lowers your per transaction fee from the payment processor.

Read Square reviews about how companies are now changing their payment terminal options. Many companies that used to rely solely on swipe terminals are now moving to wireless payment technology. With this technology, customers wave their card in front of the terminal and the transaction is complete.

In some newer technologies, the user’s phone stores a token, not even the card information, and an NFC radio sends the payment information to your terminal. These are the most secure transactions.

Train Your Staff

Train your staff to not key in the information. This will reduce processing errors, but it will also reduce your liability and transaction costs. Merchant providers charge a higher rate for transactions that are keyed in.

Likewise, they charge the lowest rate for transactions that are swiped or that use wireless processing. If the customer is the one swiping the card, even better. Do not allow customers to “skim” data off the card. This is not a usual request and should be a red flag. Card skimmers are small, cordless, device used to copy data from a card. One the individual has the data, he or she can make a duplicate card.

Usually, the only reason a person would want to do this is if they are in possession of a stolen card. Deny the sale and report the individual, if possible.

Make sure your staff know, and comply with, the procedures for credit card transactions and follow all card acceptance procedures.

Always Swipe Transactions and Encourage Staff To Do So As Well

Lastly, you reduce your risk dramatically by always swiping the card at the terminal. Many banks and merchant processors believe that the highest risk transactions are web-based ones, followed by those taken over the phone, those that are keyed in, and finally the least-risky are those swiped by the customer himself.

When possible, orient your terminal so that the staff does not have to take the card from the customer. This allows the customer to do all of the work, and it also speeds up the checkout time. On the customer’s end, it also reduces the perceived risk of an employee copying down the credit card numbers and making a second transaction later.

Following all of these rules won’t guarantee that you’ll avoid fraud, but it will reduce your risk, lower your per transaction costs, and improve overall compliance.

Ronald Gerdes is a longtime businessman who is always on the lookout for news and trends. When he finds them, he likes to sit down and share them by posting online. You can read his interesting articles mainly on business and marketing websites and blogs.

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