Visa UK has revealed a litany of new measures designed to protect small businesses and combat ‘friendly fraud’.
According to the digital payments giant, nine out of 10 small businesses have reported an increase in this type of fraud over the last 12 months, in which cardholders dispute a legitimate purchase with their card issuer.
Visa’s research claims that up to 20% of sales have been disputed, for reasons such as a child making a purchase on their parent’s device, a gym-goer who forgets to cancel a membership and customers claiming they have not received their orders, or it has arrived damaged.
The new framework introduced, Visa Compelling Evidence 3.0 (CE3.0), gives businesses the opportunity to discover whether the charge is valid and authorised by the cardholder, providing merchants with an additional level of protection, while not impacting consumers who have a legitimate claim.
Mandy Lamb, managing director of Visa UK and Ireland comments: “Small businesses are the beating heart of both the UK economy and our local communities.
“We recognise their vital importance and that’s why we are constantly evolving our protective solutions.
“These new measures will help to ensure small businesses can conduct business safely and securely whilst maintaining the high level of customer protection through Visa’s Zero Liability Policy.”
CE3.0 now allows businesses to provide records of two previous undisputed transactions using the same payment method. These payments must be between 120 days and 365 days old as of the dispute date and either the IP address or the device ID/fingerprint must match across all three transactions, along with one additional element of IP address, device ID/fingerprint, shipping address or account log in ID.
This evidence would serve as an extra layer of protection and unequivocally demonstrate the validity of any disputed transacton, allowing businesses to avoid being swindled out of their fees due to ‘friendly fraud’.
Copyright © 2023 RegTech Analyst
Copyright © 2018 RegTech Analyst