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How Can Building Material Dealers Prevent Credit Card Fraud

According to the Federal Trade Commission, credit card fraud was the most frequent type of fraud reported in 2020. The total loss due to credit card fraud was a whopping $149 million.
March 18, 2022
Credit card being held up to reader
Unfortunately, credit card fraud is common across building supply stores due to an influx in card-not-present transactions. Card-not-present transactions occur online where the merchant is unable to confirm their identity and validity of the purchase in person. Sadly, the supplier is then liable for the acceptance of any fraudulent order, and the cardholder’s issuing bank will collect the customer’s refund from the supplier should a cardholder request a cha While it’s important to know what steps to take if you’re a victim of credit card fraud, practicing credit card safety and knowing what credit card fraud looks like can help you prevent credit card fraud. In the instance of card-present transactions occurring in-store, where the merchant can review the identifying documents of the cardholder for legitimacy, like using a chip-enabled card (EMV), to further confirm the validity of the purchase – then the supplier is not held accountable for the fraudulent charges. While it’s important to know what steps to take if you’re a victim of credit card fraud, practicing credit card safety and knowing what credit card fraud looks like can help you prevent credit card fraud.
What Does Credit Fraud Look Like?
  • Credit card will not swipe forcing manual input of credit card information
  • Inconsistent order data, meaning the zip code and city entered does not match the card billing information
  • The amount spent on a purchase is far larger than what the customer typically spends
  • Multiple transactions in a short time span
  • Multiple orders from many different credit cards
  • Multiple declined transactions in a row, meaning the purchaser made many attempts without getting the card number, expiration date, and security code correct
Cost of Fraud in the United States
In the United States, losses to fraud of $9.62 billion were up from $9.47 billion in 2018 (The Nilson Report). Every $1 of fraud now costs U.S. retail and e-commerce merchants $3.60, which is 15% higher than the pre-covid study in 2019, which was $3.13. Also, 44% of merchants selling physical goods only, were victims of fraud in 2020. In addition, 55% of merchants selling digital goods were victims of ID theft and credit card fraud.
Credit Card Best Practices
  • Don’t accept credit cards that do not have a swiping feature
  • Only accept a credit card from an authorized user. Ask to see the purchaser’s ID
  • Don’t accept faxed payment information
  • Don’t be afraid to ask for more information. The more the customer complains, the more likely you are to deal with a case of fraud.
  • Prevent fraudulent returns with a clear return policy
The safest way to handle over-the-phone credit card transactions is to email the customer an invoice with a secure payment link embedded in the email. This way, the customer has to input the credit card information themselves. Also, require your employees to gather the following information if an over-the-phone payment must be taken:
  • Complete credit card number
  • Expiration date
  • CVV code
  • Billing zip code
  • The card holder’s full name
  • Billing address for the card
  • Phone number
  • Email address
Is There a Better Way?
BlueTape reduces your payment risk dramatically. With BlueTape, material vendors can focus on selling supplies and services more securely, more rapidly, more conveniently, and in a more cost-effective manner.
BlueTape Offers:
  • Secure mobile and online payments
  • Fast payment via text or email
  • Reduced risk and liability
  • Flexible payments
  • Reduced processing fees
Unfortunately, you could be diligent about credit card fraud prevention and still be a victim of credit card fraud. But, by doing everything you can to thwart it, you will have reduced your risk quite a bit. Your last step for credit card fraud prevention – use BlueTape’s payment and financing tools. With secure mobile payments via text or email, only you have access to your BlueTape account from the safety of your mobile device, reducing your risk of credit card fraud. Subscribe to our newsletter to stay tuned about upcoming webinars and blog posts.
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