Ensuring that your customer electronic payments are secure is very important because if anything goes wrong, consumers will lose trust in your business. There could also be high financial costs now and in the future, due to the lack of trust consumers will have for your business if word gets out.
How Payments Work
Electronic payments all go through the same type of system. Whether it’s a card used in person at a business, or a card used online through a service like Amazon, the card holder gives the business access to their card and information which is encrypted by the credit card companies using a payment network.
Third Party Processors
Today, there are many third party processors that you can use that take some of the issues of security out of your hands. Processors like PayPal, Stripe.com and others take that worry from your hands and hopefully their security is good enough that you never run into problems.
Another way to accept credit cards is to get a merchant account. Merchant accounts are set up separately from your bank account and only take credit card payments. They often come with the equipment you need to take cards, as well as information about how to set it up on your website. You’ll need to learn about PCI compliance.
Set Up a Process
If you’re going to take credit cards, especially if you’re using your own merchant account, you need to set up a process that you and everyone follow to ensure security. Never write down card numbers, always follow the rules that you’ve been given by the processor, and do it the same each time.
When you have your own merchant account it’s important to ensure that you get your customer’s signature on the credit card receipt or invoice. You can send invoices electronically and ask them to sign them using a signing service like DocuSign.com.
You Are Libel
No matter what, if someone uses someone’s card fraudulently, you are libel. The business always pays for the fraud, not the consumer. Therefore, it is very important for you to verify that anyone buying anything from you with a card is using the card legally.
Know the Signs of Fraud
Watch out for these signs: buyer buys via email; says they’re hearing impaired; makes a really large order; uses international shipping; card may be initially declined, then order is split; offers special instructions involving third parties; items are easily resold. It’s best to not take the order than take the chance if too many red flags go off.
Get Written Permission for Recurring Charges
If you do want to have your clients pay you via recurring payments, it’s important to get permission for charging their card again each month. Having that written permission will go far if they ever dispute the charge.
Being secure with electronic payments is imperative, whether you’re making them or taking them. Don’t use questionable websites, and be careful about who you buy from because any business can potentially be set up as a scam. Plus, pay attention to any anomalies when someone is buying.