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Fraud Monitoring

Fraud Monitoring is a set of measures to protect against fraud during online payments. The system is designed to prevent fraudulent activity and protect the funds and personal data of users. Fraud monitoring allows a real-time verification of payments for suspicious activity. If the system detects anything unusual with the payment card, it takes action. In this case, the payment may be declined, the payment card may be blocked, or the cardholder may be notified of payment issues. An alternative name for fraud monitoring is anti-fraud.

Banks and payment systems are responsible for fraud monitoring. They have their own protocols for identifying fraud, which operates in automatic or manual mode. Companies have also developed markers that can indicate suspicious payments. For example, payment by card for an unusually large amount for the user. Suspecting something is wrong, the bank may request additional confirmation of payment or even identity from the cardholder. In addition to the payment amount, the system analyzes dozens of other factors, such as:

  • IP address;
  • the device used for payment;
  • incorrect attempts to enter payment data or pin code;
  • geolocation;
  • frequency of payments;
  • payment history.

There may be dozens or even hundreds of such filters. If, in the opinion of fraud monitoring, any of the parameters deviate from the norm, this is a reason to more carefully check the payment. Sometimes suspicions may be unfounded and, in fact, the payment card owner simply acted differently than usual. For such cases, it is sufficient to use the 3D-Secure system with additional identification of the payment card owner. After passing such a check, the fraud monitoring will give the payment a green light.

Fraud monitoring is extremely important for e-commerce. It protects customers of an online store from impulsive decisions and fraud. For online stores, fraud monitoring is important because it protects the reputation of the business. Customers will not accuse the seller of theft and will remain loyal to them. The main thing is that fraud monitoring works correctly and is not too picky about transactions. Otherwise, it will lead to the system blocking many normal payments and this will deter buyers.

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