Expert advice on Payment Platform Fraud
What’s the single highest risk to a platform business? Higher than losing customers, higher than a too-slow-ramp to LTV? That’s a tough question. But the reality is that there is a single event (or rather rapid sequence of events) that can not only ruin a business financially but also kill its reputation in the process.
That single event is a scripted fraud attack that can drain your funds or your customers’ funds in a matter of hours or even minutes. Fraud is a constant risk in e-commerce, crowdfunding and any other business platform where transactions take place. And it is a risk that evolves continuously. And when a profitable vulnerability is found by a fraudster they rapidly move to repeat, operationalize and script an attack on that vulnerability to make as much money as they can as fast as possible before the window of opportunity closes.
There are other longer, slower, more painful deaths that a platform can suffer from fraud activity, more like a death by a thousand cuts. Essentially if fraud volume gets too high then your customers suffer and your reputation suffers and soon your platform will be considered untrustworthy.
These are just two of the high risk possibilities that can affect platform businesses that take payments if they pay insufficient attention to fraud or if their payments provider pays too little attention.
We recently ran a webinar on the topic with a great presentation from our VP of Risk, John Canfield. He talked about the different kinds of fraud that can affect platform businesses and how to think about them and approach managing the different problems that arise. We also had a lively Q&A on the topic. If you want to know more then please go sign up to watch it on demand.