Since then, the number of online transactions has increased rapidly, bringing an estimated 50% increase in sales across the board to ecommerce sites. In 2020 alone, this has raised “e-commerce’s share of global retail trade from 14% in 2019 to about 17% in 2020,” according to the United Nations.
While many businesses were prepared for a surge in transaction volume, that doesn’t mean it didn’t happen without its hiccups. A number of factors can ‘go wrong’ when a customer tries to complete an online transaction.
Think about it like this: when you’re at the grocery store and you check out and your credit card doesn’t go through to your surprise, you have other options at your disposal. The cashier can try it again, you can use another card easily, or you can pay with cash.
These options become limited when you’re purchasing online – especially if the payment processor first says that the charge did appear to go through.
The result? You likely won’t know the charge didn’t go through until later, or won’t know how to fix it – if it’s an issue with the processor, your bank, your card, or otherwise.
At scale, this leaves a tremendous number of sales on the table for businesses who need to rely on their online transactions working. Additionally, this makes it harder for businesses to manage the number of transactions that are coming through.
Then, there’s the issue of online transactional fraud. According to the New York Times, an astounding $145 million has been lost by Americans due to fraud just since COVID-19.
The risk of fraud goes up significantly when transactions are done online and there are fewer methods of identity verification or otherwise.
Here are a few ways e-commerce sites are building their defenses against transaction hiccups and dangers as online sales continue to soar in the post-COVID online marketplace.
They’re implementing new technologies to prevent fraud
Thankfully, in entrepreneurship, many founders are creating solutions to these problems. For example, Chase Harmer, the CEO of PayCertify, has built a technology that will help to prevent fraud.
According to Harmer, PayCertify’s technology does this in a number of ways.
1. It harnesses the power of machine learning and artificial intelligence to detect behavior that’s consistent with fraud. Since this harnesses machine learning, the technology will also teach itself to detect how fraudulent actors interact with your site specifically.
2. It shifts transaction liability to the customers’ bank. PayCertify uses ‘Frictionless 3D Secure,’ which moves the transaction’s liability away from your business. If the transaction is fraudulent, no money will be lost on your end.
Ensure that you have a technology embedded within your processor that can protect against fraud.
They’re updating payment descriptors and processor protocols
Many of the online transaction problems are caused by misunderstandings around how the credit cards are processed. Since each credit card company has its own format of processing, it’s important to make sure that you’ve followed the instructions of how to set up the processor, so that you can accept a wide range of credit cards or payment options, and no customer will have a problem with this type of transaction.
Additionally, make sure that the payment descriptor accurately describes what your company is. Rick Lynch, the senior vice president of business development at Verifi Inc., shared with creditcards.com that “the majority of disputes his firm handles have to do with unclear payment descriptors.”
Think about the last time you checked your transaction history. Have you ever seen a transaction that you don’t recognize? It may have been a purchase you confidently made, but since the description isn’t updated or doesn’t reflect the name of the company, you wonder if someone has your credit card number.
This happens all the time with customers, especially during tight financial times. They do not hesitate to call their credit card companies for chargebacks if they don’t recognize a description.
They’re acting at the first sign of trouble
Don’t wait until there are multiple incidences of frauds or chargebacks to address a problem. The moment a customer contacts you with an issue, look into it by calling your website’s technological support, your payment processor, or whoever else you need to call.
Many make the mistake of assuming the problem is with a customer’s bank or credit card, which sends the customer on a hunt to figure out what the problem is. If the bank says there are no problems on their end, the customer might go elsewhere to make a purchase, or abandon cart on your site.
Of course, there is always a chance that it is a problem with a customer’s credit card or bank. That’s why knowing the state of your processor and potential problems (and their accompanying solutions) is critical, so you can offer the best possible customer service no matter what transactional hiccup is occurring.