31–40 of 69 posts
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Realistically, the percentage of customers you lose by accepting Bitcoin is probably much higher than the cost of handling credit card fraud.
Well, obviously, do accept Bitcoin in addition to credit cards, so no customers are lost, only gained.
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Well, obviously, do accept Bitcoin in addition to credit cards, so no customers are lost, only gained.
And no fraud would be stopped.
As this fraction increases, fraud is reduced further and further.
It would be interesting to have a payment platform that evaluates the trustworthiness of a customer right before payment (based on factors such as customer history, shipping address matching the billing address...), and force those deemed "risky" to pay in Bitcoins. It could even handle CC authorization failures: "credit card declined? No problem, pay in Bitcoins instead."
I'm surprised the part on combatting friendly fraud (4.2) didn't include a part about contacting the customer directly, most likely via phone. If you are in an industry where this occurs more often, you might even want to invest in telephone authentication. While it won't stop the friendly fraud, it will be a deterrent. Anyways, contacting the customer can usually get things resolved as well, even if they went straig…
The best way to combat friendly fraud is extensive logging and 3DS.
3DS, while effective, is not a bullet proof solution. Requiring 3DS transactions will impact sales, and can impact them enough that it's better to not use it. I always recommended a scoring approach (reach a certain threshold, and we require 3DS).
Even still 3DS only affects the initial transaction. Any recurring payment won't benefit from the 3DS transactions. There are ways to encourage 3DS use (discounted membership fees if one performs a 3DS transaction), but outside of games like that, 3DS only affects the transaction it's made with.
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Sorry about that! Just did a proofread for obvious errors and I think I got them all. I'm omw out now, but I'll take another look when I get back. It's open source, you're welcome to contribute a fix: https://github.com/balanced/balanced.github.com/blob/master/...
You're telling me you've crowdsourced your editing for marketing materials? Tell me you're not serious.
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And no fraud would be stopped.
Not stopped, but it would decrease fraud, as the fraction of payments made in bitcoins is guaranteed to be impossible to charge back. As this fraction increases, fraud is reduced further and further. It would be interesting to have a payment platform that evaluates the trustworthiness of a customer right before payment (based on factors such as customer history, shipping address matching the billing address...), and…
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You're telling me you've crowdsourced your editing for marketing materials? Tell me you're not serious.
I just submitted a fix for one of the issues I found. It's actually just as easy as reporting the issue to them directly. Thanks 'fork & edit'!
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A single user attempting purchases with many different credit cards is fraudulent 100% of the time!!
This probably assumes that all cards are under different names.
We currently have an issue where someone is using stolen credit cards to buy "digital goods".
We in the UK and Scandinavia, so we started out blocking purchases of digital goods from the UK. Fraud goes to zero right away.
The fraudsters moves to using stolen UK credit cards in Denmark, via a large number of Danish IPs, fine... We'll just require that the card is issued in the country where your IP indicates that you're located ( not 100% correct, but close enough ).
At this point fraud has been reduced to zero for a few weeks. The next we really where not expecting. The same pattern of buying starts showing up, seems like fraud and it turns out it is. We now see a stolen Danish credit cards.
At this point we're more or less reduced to having to approve every purchase manually. The only real solution currently is 3DSecure for MasterCard or Verified by VISA. These solutions are very American and not at all what European customers expect to see. Enabling 3DSecure scares of legitimate customers, but it's currently the only solution.
The article looks at high velocity, that does nothing in some cases, if people are out to scam you, they will appear as a new customer for a new IP, with a new card.
CSC are useless, these are stolen all the time.
AVS is supported by almost no one.
Looking a transaction amount compared to the mean doesn't really work when you mostly sell one product at a time.
Recently created accounts are actually a good indication of fraud, but mostly you have false positives.
Blocking high risk countries don't work for digital goods.
Large distance between IP and billing address, doesn't work well in smaller countries, but worth considering. Somewhat difficult to implement though.
High number of card from the same person... That never happens. Our legitimate customer are the only ones that might use different cards. In the case of fraud cards and accounts are often used only once.
It's not that the article is a bad write up, but non of the information will protect you against someone that wants to scam you. Physical products are easier to safe guard, because the bad guy will need to pick it up at some point, digital good is a lot harder to secure.
I would actually be interested in knowing how others deal with a certain type of fraud. We currently have an issue where someone is using stolen credit cards to buy "digital goods". We in the UK and Scandinavia, so we started out blocking purchases of digital goods from the UK. Fraud goes to zero right away. The fraudsters moves to using stolen UK credit cards in Denmark, via a large number of Danish IPs, fine... We'…
Edit: to mean, who would bother to do payment fraud, when you can just download torrents.
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Not stopped, but it would decrease fraud, as the fraction of payments made in bitcoins is guaranteed to be impossible to charge back. As this fraction increases, fraud is reduced further and further. It would be interesting to have a payment platform that evaluates the trustworthiness of a customer right before payment (based on factors such as customer history, shipping address matching the billing address...), and…
Based on the comments above ( http://news.ycombinator.com/item?id=5259876 ), it seems like Bitcoin is just allowing merchants to kick the chargeback risk down the road to the Bitcoin exchanges.