Credit card fraud is a problem most small businesses fail to think about, until it hits them.

If you sell online, or by mail, your business is potentially at risk of losing money from fraudulent credit card orders. While this is probably something that rarely crosses your mind, it's a threat you shouldn't ignore.

Tips to minimise credit card fraud loss

  • Avoid key entered transactions on terminals: Key entered transactions occur when card details are manually entered into the terminal instead of tapping, inserting or swiping the card. This by-passes the card’s security features and greatly increases the likelihood of fraud. If a dispute is raised by the cardholder, the merchant will be liable and will be obliged to pay the funds back to the cardholder, as well as any applicable chargeback fees.
  • Never hand the terminal over to the customer who may initiate key entry and complete a fraudulent transaction. (If the merchant has key entry enabled).
  • Be cautious of customers who wish to correspond via email only and are not contactable by other means such as phone.
  • Beware of customers who are willing to pay more than the cost advertised. Genuine customers are more likely to try to negotiate on the sale price.
  • Watch out for unusually high orders placed for goods. If it sounds too good to be true, it usually is.
  • Look out for requests for funds to be forwarded to a third party. This scenario may occur if there is an overpayment and a refund is requested; or if surplus funds are paid to cover freight costs and the customer stipulates which freight forwarder to use.
  • Watch out for customers who claim to be not contactable, and/or unable to view the goods being purchased.
  • Avoid any requests to transfer funds via Western Union.
  • Be aware that if you accept transactions when the card is not present in the sale, it is you, the merchant, who is ultimately liable should a dispute be raised against the transaction.

Whilst the above are some scenarios of how scammers can target your business, the list is not exhaustive. Always be vigilant and aware of tactics that are used, as this will go a long way to protect your business.

Business owners need to ensure that obligations under the merchant agreement are understood to prevent any unexpected surprises.

To find out how to register for our free Electronic Chargeback Reporting service, email

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