The COVID-19 pandemic has significantly altered buying behavior and how businesses run day-to-day operations. The growing number of online customers has not just impacted how ecommerce merchants run their businesses but has also affected the pattern of fraud behavior.

As per [a 2021 study by Juniper Research]( UK – 5th July 2021,period between 2021 and 2025.), online fraud is set to exceed $200 billion by 2024, with fraud attacks becoming more sophisticated as time goes by.

Creating an effective dispute and fraud prevention strategy that best suits your business can help prevent fraud from occurring. By employing some of these best practices as part of your overall strategy, you can avoid excessive chargebacks and reduce potential customer burden and losses.

5 Steps to Detect and Prevent Fraud

1) Contact Customers to Confirm Orders

Contacting customers by phone or email to confirm their details before fulfilling an order can give you time to verify that a payment is legitimate.

Often fraudsters will use fake email addresses and if you send a simple templated email it could result in an immediate ‘This email address does not exist’ failure which will expose them. Calling the customer under the guise of verifying their shipping address may also raise some red flags. A nonsensical or evasive answer is typically a good indication of potentially fraudulent behavior.

2) Manually Review Payments

Taking a few minutes to look over an order is often all it takes to detect and prevent fraud. Here are some considerations when reviewing a payment:

3) Create Store Policies

Taking the time to put policies in place with your staff is often the most effective way to protect against fraud. At Rain, we hear stories all the time of shops making an exception one time to their store’s policy and it turning out to be fraud. Train your staff with clear, concise policies and they’ll be empowered to help protect your business. Here are some considerations when creating policies: