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Threshold: A Valuable Tool for Fraud Management

When a criminal obtains a stack of stolen credit cards or credit card data, one of the first things he or she will do is run a series of test transactions to determine which individual cards work. The purchase amounts usually range from a few pennies to a few dollars — transaction sizes small enough to go unnoticed, the thief hopes.

With the cards that do work, the thief will begin making larger online purchases. These larger transactions are the ones that receive the most attention because they typically add up to hundreds or even thousands of dollars in losses.

A business could devote time daily to going through credit card sales data with a fine-tooth comb, allowing it to flag any test purchases before the damage gets worse. And in fact, many merchants do precisely that. After all, even fraudulent charges measured in pennies are bad for business, because they involve more than a monetary cost. You’ll still have to spend hours talking with banks and payment processors to have those transactions reversed. Moreover, customers will have less faith in the security of your payment environment.

A better approach is to become proactive. With BluePay’s Threshold tool, you can halt this type of fraudulent activity before losses occur, whether the pending transactions are small or large.

How Threshold Works

Threshold allows you to set up both transaction and credit limits for sales in your store:

  • You can establish minimum limits to prevent your merchant account from being used for test transactions. If the least expensive item in your store is $6.87, for example, no purchases below that threshold should ever be made. You can instantly flag such transactions as fraudulent.
  • You can set maximum dollar amounts as well, based on your priciest items. If the most expensive thing you sell costs $2,500, any purchases over that amount also will instantly get flagged and rejected.

So, what if someone is buying multiples of a big-ticket item? For example, a customer wants to buy two $2,500 widgets, for a sale totaling $5,000? If that’s a legitimate purchase, you definitely don’t want to lose the sale. If it’s a fraudulent one, however, you don’t want it to go through.

Not a problem. Threshold can be used in conjunction with other Fraud Management Tools in BluePay’s arsenal. If customers often buy multiples of big-ticket items, you may want to also explore these tools:

  • The On-Hold Functionality filter, which allows you to place a temporary hold on potentially suspicious activity until you’ve had a chance to review the transaction.
  • The Negative Database and Geo IP Tracking filters, which allow you to blacklist known offenders or purchases made from suspicious locations.

Learn More About Our Fraud Management Services

If you want even greater granular control over your business’s payment environment, be sure to check out our full range of Fraud Management Tools. Each serves a unique purpose, and you can mix and match them to suit your needs.

READ MORE ON PCI COMPLIANCE

Topics: PCI Compliance and Fraud Prevention, Small Business Tips

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