Living in this technologically flourished period, it is very difficult for a businessman to prevent the underworldly evils, petty criminals, and funded extremism. We are referring to the fraudulent activities done by the fraudsters in the ecosystem of digital business. This is otherwise known as e-commerce fraud. In order to eliminate this problem, you need to know about fraud prevention. This is something that will protect your online business from fraudulent online transactions. Anyway, if you do not have a solid idea about fraud prevention technique, you will not have to worry at all. Here, we will be giving you a brief elaboration of fraud prevention. So, go through the below-mentioned points to understand the ecosystem of fraud prevention.
Fraud Prevention: What Is It?
Fraudulent transactions cause reputational and financial damage to the financial institution and consumers. Now, fraud prevention is an advanced technique; in other words, we can say that it refers to the utilization of strategies to prevent fraudulent online transactions. Analyzing the present era, we must admit the fact that mobile banking and online transactions have gained huge popularity. This is why the financial institutions must have strong fraud prevention technology in order to deliver satisfactory service to the merchants as well as the customers.
Fraud prevention technique has a very inextricable connection with cybercrime. Fraudsters have a very strong network; they steal your financial information such as credit card details and many more; after that, they sell it on the dark web. Talking about fraud prevention professionals, well, they develop fraud detection solutions and new authentication techniques. Considering the present era where technology is actually flourishing, we must admit the fact that fraudsters are using advanced malware and sophisticated strategies to successfully implement their fraudulent activities.
On the other side, we should also admit the fact that the fraud prevention technique has got remarkable improvements. The fraud prevention professionals are working hard to make it as reliable as possible. However, in order to prevent fraudulent activities, it is very important for professionals to understand the tactics that fraudsters are using. Now, this is where cybercrime and fraud prevention are interconnected.
Understand The Difference Between Fraud Detection And Fraud Prevention
Most businessmen and consumers across the globe have a strong confusion between fraud prevention and fraud detection. They think that these are the same things. Well, both these things are inextricable parts of cybersecurity. But, there are differences between them. We have explained them below in order to eliminate the confusion.
- Fraud detection basically occurs during fraud attempts.
- The core objective of fraud detection is to reduce the number of fraudulent activities.
- Fraud detection solution reduces fraud activities and thus, it improves the user experience.
- Well, Fraud prevention basically occurs before a fraud attempt.
- The main objective of the fraud prevention technique is to mitigate the risk of future fraud.
How Fraud Prevention Works: Machine Learning
If you are wondering how the fraud prevention technique works, you are in the right place. Here, we have explained how it works. Thus, talking about the present situation, the fraud prevention technique relies on machine learning. There are mainly two types of machine learning- Unsupervised machine learning and Supervised machine learning.
Anomaly detection technology comes under unsupervised machine learning. It basically determines the unusual and usual manners in a transaction. On the other side, supervised machine learning is more advanced. It goes through the historical information and thus, it actually determines whether the transaction is usual or unusual. It provides a real-time fraud score. You cannot have fraud experts at all times for monitoring the events. This is why; machine learning technology is getting more preference. It is actually human challenges and availability bias. In short, machine learning technology is helping the fraud prevention team to make effective decisions on fraud events.
Common Fraud Schemes And How Financial Institutions Help To Prevent Fraud
As we are talking about the fraud prevention technique, you must know about certain fraud schemes that fraudsters are using nowadays. These are as follows:
- Denial of Service or DoS attack.
- Use malicious software
- Phishing technique
Talking about the financial institutions, well, they can do the following things to prevent fraud:
- Integrating safe payment methods.
- Guarding the personal information of the consumers
- Checking credit reports on a regular basis
- Conducting online searches
- Remain doubtful about the free trials
Not A Rapidcents Merchant?
As of now, you have understood the ecosystem of fraud prevention technique. Thus, if you are running an online business and want to integrate fraud prevention into your business operation, you need to get in touch with Rapidcents. With Rapidcents’ Fraud Prevention, you can easily prevent fraudulent transactions and thus, you can provide outstanding customer service. Rapidcents provides 27/7/365 customer service. So, do not just think; become Rapidcents merchant now and avail the convenience of fraud prevention.