Payment Basics
Best Practices for Accepting Card Payments
When you accept a credit card purchase, there is always a chance that the card or card information was stolen and is now being used for fraud. It’s also possible the buyer would try to abuse the chargeback mechanism and make a false claim.
At Wix, we work hard to protect our merchants from fraudulent behavior. However you, as a merchant, are always the best line of defense against fraud, since you are fully aware of all that is happening with a particular order and buyer.
In this article, learn about:
Recognizing possible fraud
Fraudsters often use sophisticated techniques to achieve their goals, and they generally operate in 2 ways:
By illegally obtaining goods without paying for them
By deceiving the merchant to illegally obtain funds
There are a number of tell-tale signs that fraud may be in play. To minimize risks and possible chargebacks while accepting online orders, please review the following potential red flags. If you notice any of the behavior below, you should consider taking an extra step to be assured that your customer is not fraudulent. Be wary of:
Bulk orders: Large orders on goods that have high resale value (sneakers, electronics, designers’ handbags, etc). Large repeated orders on such items also pose a high risk.
Card processing behaviors: Multiple lost or stolen declines, or multiple attempts from different cards. It is unlikely that one customer will have 6 or more cards. Likewise, beware of cases where customers ask to split the payment into 2 or more instalments, especially using different cards.
Unusual shipping behavior: Be wary if shipping is overpriced in comparison to the value of goods; if your customer insists on a rush-shipping option without sign-on delivery; or shipping to forwarding companies that provide reshipping to "third countries".
3rd party payment requests: Avoid requests to pay for special “vendor” services that you do not offer (such as door-to-door delivery, custom shipping, catering or event planning). These may be Western Union, Zelle, Cash App or similar money transfer requests. Any 3rd party requests are often indicative of a scam. Please be aware that such payments are final. Likewise, do not issue refund requests via these payment methods. Use the original payment method provided by your customer.
If you face any of these red flags, we recommend some additional buyer verification checks. These can include a government-issued ID request, a telephone call, or a check via Zoom. Also, make sure that the order type you are handling correlates with your regular business practices.
You always have an option to cancel the order and refund the initial payment if you spot behavior that may be considered fraudulent
Handling offline card payments
Offline card payments fall into 2 categories:
Customer present: The customer is standing in front of your POS reader and inserts/taps/swipes their card
Manual Card Entry: The customer is sharing their payment details with you, and you are inputting them via a POS terminal. This may be with, or without, face to face contact.
When it comes to customer-present transactions, please make sure that you use an EMV chip whenever possible. This is the chip visible on most modern credit / debit cards. ‘Liability shift’ will protect you as a merchant in most cases by using EMV, along with awareness of the fraud patterns listed above.
Consider asking for a government-issued ID or another payment method if you have doubts about the buyer. In a case where the card is not working because of its poor condition, it's preferable to ask for another payment method, rather than input the card details manually. Fraudsters may spoil counterfeit cards on purpose to make you use the card via a manual input terminal, due to the low fraud protection of manually entered card payments.
Manual Card Entry transactions are the most high-risk way of accepting payments.
You should accept this method only from trusted clients, or when the fraudsters are not attracted to your business due to its nature (a kindergarten, or a kids summer camp, for example; or items with a low resale value).
Remember, when it comes to chargebacks for manual input payments, the liability shift is most likely to be on the merchant's side. Therefore, it is difficult to win a dispute against such chargebacks.