Cashless payments can offer ease and efficiency for customers and businesses, but they can also bring an increased risk of scams, especially point of sale (POS) fraud.
Here, we'll explain common types of fraud to look out for, plus tips on how to avoid them.
Credit card fraud is the criminal act of using stolen or fake credit card information to complete a transaction, such as purchasing an item or obtaining a cash advance.
There are many different types of small business credit card fraud. Account takeover fraud, for example, occurs when someone steals another person's credentials to make unauthorized transactions.
If not handled properly, credit card fraud can cost businesses valuable revenue, sensitive information, and consumer trust. As the Federal Trade Commission reported, consumers lost more than $5.8 billion to fraud in 2021 — a more than 70% increase from 2020.1
There are three main types of POS fraud to watch out for:
To help identify POS fraud, frequently check your transactions and keep an eye out for unusual activity.
Fraud can bypass POS security through:
Online fraud prevention is important because if your business receives a fraudulent payment, you could be held financially responsible for the loss.
Nobody knows your business as well as you. You know your biggest customers and are familiar with their buying patterns. Because no payment processor will ever surpass your knowledge in these areas, your involvement in fraud protection is essential.
Protect your business from in-person fraud with these POS system security tools and techniques:
POS fraud prevention strategies:
Learn more about PayPal fraud protection.
In partnership with three expert business owners, the PayPal Bootcamp includes practical checklists and a short video loaded with tips to help take your business to the next level.
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