A vast amount of cardholder fraud claims can cause a higher number of declines. On the other hand, there exist other actions that can result in authorization declines by card issuers.
Blow you can find other actions that may knowingly be applied by merchants, thus leading to credit card declines.
- Not Applying CVV Capture For Checkout
CVV, CVV2, and CID are the last 3 digits on the back of credit cards or the last 4 digits on the front of American Express cards. These are added to provide extra security and confirm that the person entering a card number in a CNP transaction is in the possession of the card.
As the credit card brand don’t require this and it has no effect on interchange qualifications, there are merchants who don’t capture the CVV for checkout. They think it negatively impacts conversion. Moreover, as this information is often available in those cases when hackers sell stolen card numbers to fraudsters, the CVV capture doesn’t imply it is the true cardholder.
That’s why some companies choose to use more advanced and sophisticated tools to prevent credit card fraud. There are merchants who even think the CVV does harm to conversion.
- Not Using 3D Secure
3D Secure is like CVV. Rarely, cardholders will be required to use an additional password or to answer security questions if 3D Secure is used. 3D Secure implies a liability shift from the merchant to the issuer and a reduction of interchange. Moreover, it counts for higher authorization rates for many merchants.
According to CardinalCommerce, Amtrak witnessed a decrease in fraud chargebacks and a 2.6% improvement on overall authorization rates by selectively using 3D Secure. Also, Amtrak saw that by providing more information about the transaction to issuing banks through 3D Secure resulted in increased confidence in the transaction and fraud prevention.
Choosing HRG, you can open a reliable and secure high risk merchant account for your online business. The High Risk Guys will help you protect your business against fraud. Highrisk-merchantaccount.com offers a simple application process and the fastest approvals in the industry.
- Using A $1.00 Pre-Authorization
Previously, merchants used to confirm credit cards’ validity via $1.00 pre-authorization, which aimed at preventing fraud and to verifying the AVS and CVV information before the full amount would be charged.
Now, CNP merchants cannot assume that if a transaction is declined, it is caused by a problem between the cardholder and the bank.
The more information is provided by merchants during the authorization process, like CVV and 3D Secure, the more issuers get proactive against credit card fraud. Moreover, the issuer benefits from successful transactions, so declined transactions aren’t optimal for them either. The more details merchants provide, the easier the situation becomes for issuers, counting for increased revenue and customer satisfaction.Get Started Now