How Emerging Markets are Driving the Digital Wallet Trend

Feb 26, 2019 by

How Emerging Markets are Driving the Digital Wallet Trend

It’s been suggested that emerging markets could see a major economic boost if they made just one simple change: go cash-less. It’s already happening around the world, and there is good reason to go cash-less.


Storing cash is risky, especially if you have a lot of cash. In developing nations, one job might lead to significant sums of cash for someone, but they’ll need to live on that for week or months while they find more work. High incident rates of theft are propelling more retailers to adopt credit card terminals to store money digitally and make it harder for thieves to steal.

Nearly 80% of adults in emerging markets have either a mobile phone or a smartphone that they use on a daily basis. Even more carry credit and debit cards and as these technologies merge the POS becomes a perfect mechanism to help transmit payment data digitally.

There is a large segment of the population in any developing or developed nation that is underbanked, meaning they either don’t maintain a bank account or they aren’t benefiting from doing so. Part of the problem is that these people need closer control over their budgets, in order to plan and save effectively.

Right now, banks can’t respond to these pressures fast enough and the costs of providing the existing services is far too high. With digital transfers, all transfers are much faster and more affordable. That makes the mobile wallet the new cost-saving measure of the future for many on the lower income. Even those who wish to start a business will benefit from this revolution. They’ll find it easier to pay contractors from anywhere in the world, and make international purchases they need to run their business.

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The Basics of the Payment Processing Landscape

Jan 23, 2019 by

The Basics of the Payment Processing Landscape

In 2014, and even a bit in 2015, the landscape of merchant processing looked pretty grim. Not a lot was happening at the consumer level, technology wasn’t very compelling and good deals were hard to find. Businesses didn’t have a lot of options when it came to transferring money online, and most just went with whatever services were offered through their bank or merchant account.

This led to a lot of very expensive fees an inefficient money transfers. Today, things look very different and the future is rather bright for companies who utilize credit card processing. There are several reasons why that is the case.

New Technology

Smartphone adoption rates are higher than they’ve ever been, which means that everyone around you has the potential to carry their wallet in their pocket without ever carrying cash. These devices are secured, sometimes with multiple levels of encryption, and they are easy to use as a means for transferring money.

Merchant accounts are adapting by adding new ways to pay at the terminal. Customers can use digital wallets, mobile devices and more. This goes against the traditional credit card system, but consumers don’t seem to mind. It’s safer to pay with a phone, or to pay online, meaning more of us can buy what we want when we want.


The missing piece of the puzzle isn’t the willing consumer, it’s a business ready to adopt this new technology. It’s been difficult to find a good system that you can link to an existing merchant account, and provide an ecommerce component. Today, that’s no longer the case as there are more options than ever before.

Some of these services are tied to an account, but not all of them. As compatibility improves, it will be easier for consumers to consolidate their wallets.

Right now, the landscape is still fractured but that won’t always be the case. Soon, digital wallets on your mobile device will be the standard. You’ll be able to receive your paycheck over mobile, pay your bills and buy your groceries, all with nothing more than your phone.

Better Security

Of course, the innovation everyone will benefit from (but isn’t the most exciting) is better security. Transactions on these new systems use an anonymous instance, so everything takes place in a vacuum of sorts. This makes it harder for hackers to detect, and nearly impossible for them to extract any meaningful data from.

Read a Related article Below:
Why Do Your Credit Card Terminals Have Chip Readers?


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8 Ways to fight Chargebacks

Oct 9, 2018 by

8 Ways to fight Chargebacks

Article by Pierre Zarokian.

Credit card chargeback fraud is a persistent problem for merchants and can be hard to detect. But there are ways small-business owners can fight back.

Fraudulent chargebacks include cases of identity theft and so-called “friendly fraud,” in which a customer deceptively says a product or service was never ordered or was not delivered. Friendly fraud accounts for 18 percent of all merchants’ fraud cases, according to the 2014 LexisNexis True Cost of Fraud Study.
Usually, you won’t hear from the customer if they’re committing friendly fraud, says John Monarch, CEO of Direct Outbound, a Greenville, South Carolina, call center firm that provides chargeback dispute services. Many customers go straight to their card issuer as a matter of convenience, whether their chargeback is a result of someone misusing their credit card, friendly fraud, or even incorrect chargebacks that are a result of not recognizing the purchase. A 2014 survey by Trustev found that 17 percent of U.S. consumers have disputed charges without contacting an online merchant, and 7 percent admitted to lying about the condition of a product so they could return it for a refund.

If chargeback fraud goes unchecked, the consequences can be severe. Too many chargebacks could prompt your acquiring bank to terminate your account. That could make it almost impossible to get a new account, according to Tim Russo, fraud prevention team leader at cleverbridge, an e-commerce technology firm in Chicago.

Russo says card associations use a database known as MATCH, which stands for Member Alert to Control High-Risk Merchants (previously known as the Terminated Merchant File, or TMF). The system is used by MasterCard and Visa processing banks to identify merchants that have had their accounts terminated. Once a merchant is on this list it is highly unlikely that future merchant account applications will be approved. “The TMF, or MATCH list, is essentially a blacklist from which it is almost impossible to be removed,” says Russo.

Determining whether your business has a chargeback fraud problem can be tricky. However, there are several important signs that fraud is an issue, as well as some smart ways to prevent it — or, at least, fight it when it happens.

1. Understand your risk. Merchants who do business online are at particular risk of chargeback fraud because they are not able to see the credit card being used or check a customer’s identification or signature, says Monarch. As a result, it can be easier for fraudsters to use stolen credentials to order merchandise online. In addition, because the merchandise is often shipped without a signature required for delivery, it can be easier for friendly fraud perpetrators to claim the product was never received.

The problem is growing, too. The LexisNexis study found that 51 percent of the fraud experienced by merchants who accept online transactions comes from the online channel, compared to 42 percent in 2013.

Knowing that you’re more vulnerable to risk gives you an indication that you need to be more vigilant about verifying what you can and tracking fraud overall, Monarch says.

2. Flag verification issues. Erik Van Riper, founder of Build the Store, a San Fernando, California, online business that builds e-commerce platforms for other companies, says preventing fraud requires using all possible verification components when fulfilling a transaction. If the card is present, ask for identification. If it’s not, you need to take other measures.

“One thing that we insist on for any credit card transaction is that the billing address matches the credit card billing address. The shipping address can be different, but we insist that at least the knowledge of the billing address is there, and correct,” he says. If the purchaser can’t provide this verification, the transaction is not approved.

3. Look for unusual activity. From there, Van Riper recommends monitoring transactions for unusual activity, such as orders for high volumes of product or for many expensive items of the same type or brand. Review the location of the transaction. If the billing address is in New York and the customer is shipping to a place in Oregon, you may wish to further verify the transaction by contacting the customer. Set a threshold — say, $100 — and require a signature on the package for any shipment valued at more than that amount, he recommends.

4. Examine notification codes. When you receive a chargeback, it will have a reason code. Each code, which varies by card network, will indicate the reason for the chargeback, such as “counterfeit magnetic stripe” or “fraud, card not present environment.” Once you have the code, investigate the transaction to spot irregularities, says Russo. Were there missed indicators that this was a fraudulent transaction?

5. Review nonfraud chargebacks and declines. Don’t just scan your reason codes for fraud. Investigate other reason codes and your decline rates, Russo says.

High decline rates may signal a problem with attempted fraud. But some codes might indicate customers don’t recognize their transactions, he says. If you see those codes regularly, it could mean you need to work with your credit card processing company to clarify the descriptor that appears on customers’ credit card statements. It’s also a good idea to include a telephone number on the descriptor, if possible, so customers can easily contact you if they have questions about charges.

The bottom line is to track the reasons for your chargebacks and try to take steps to remedy them. If you’re not tracking this data, you could have a problem before you even know it. “Tracking customers that have charged back is usually a good idea, because if it was a case of ‘friendly fraud’ there’s the chance that it will be done again,” Monarch says.

6. Make your case. If a chargeback has been filed, the bank will ask for all records you have verifying that the order is real. Be sure to provide those in a timely manner, Monarch says. They may include terminal records, signatures and any other information available for in-person transactions. Online transaction backup may include address verification and CVV verification, IP address information that coordinates with the purchaser’s address, and product delivery records with delivery confirmation showing the customer received the package.

The TMF, or MATCH list, is essentially a blacklist from which it is almost impossible to be removed.

— Tim Russo
Fraud prevention team leader, cleverbridge

Monarch says it’s usually not helpful to try to contact the customer if they have already initiated a chargeback. “The chargeback is on record against you at this point,” he explains. “Even if you win and get your money back, it still counts against your merchant account for the month.

“The best plan of attack, if it’s already filed, is to simply gather as much data as possible, write up a detailed document regarding how one purchases your product or service, and submit all of this to the acquiring bank, which will have mailed or faxed you a chargeback letter,” he says.

7. Get your data. At MasterCard, the central repository for fraud data is the System to Avoid Fraud Effectively (SAFE), which supports fraud prevention programs and security efforts, Russo says. All MasterCard issuers are required to report fraudulent transactions to SAFE at least monthly. SAFE then generates reports for both issuers and acquirers and provides data for other security and risk management programs, as well as merchant audit programs.

Your credit card processing company likely has access to this data, Russo says. Asking your processor for as much of that information as possible may be helpful if you have a series of fraudulent transactions of less than $30 (the threshold at which you are typically notified) that are caught before they get to you. He admits it can be hard to get a full accounting of this type of activity, but the more volume you do and the better relationship you build with your processor, the more likely it is to help you.

8. Work with your processor. Russo, who has previously been employed by two processing companies, says these firms may have additional resources to help you combat fraud, such as suggestions for enhancing security and advice on how to better verify transactions. Stay in touch with your processing company to ensure that you’re adopting the latest and best practices to prevent fraudulent transactions, he says.

Spotting chargeback fraud can be tricky, but by knowing where to look and using that information to improve your operations, you can stave off losses. It’s not a one-and-done activity, though. Small businesses must be vigilant to minimize chargeback fraud on an ongoing basis.

Pierre Zarokian is a digital marketing Expert. Read more articles by Pierre Zarokian here.

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How Merchant Processing Services are Countering Global Transfer Theft

May 11, 2017 by

How Merchant Processing Services are Countering Global Transfer Theft

Summary: Transferring money to another country? You’d best carefully select a merchant service that implements the highest security measure available.

One of the most challenging tasks that merchant services must face is the global transfer of money. You’ve heard the stories of fraud, theft, and corruption all over the news, so it’s likely that you’re skeptical when wiring money overseas. And to add fuel to fire, the transfer must stop at multiple points, increasing the risk of it being hijacked by hackers. This guide is designed to showcase the increasing level of security being implemented by merchant services to minimize the risk of transfer hacking.

How Secure is Secure?

When a credit card merchant account first authorizes the transfer, they provide a secure means beforehand. This is done via SSL encryption to help keep the transfer anonymous to others – and with the amount of sensitive data such as account numbers floating around, it’s absolutely mandatory to keep this secure.

When a credit card is swiped or processed, the payment gateway will search for authorization. Once it receives confirmation, it will tag the transaction with a key that matches the user’s bank account. Now, transferring money overseas isn’t much different from this. The fact that it requires travelling through different countries before reaching the destination may require additional days to complete, but more notably, it also presents a security risk if these financial institutions are negligent in their transfer operations.

The Bottom Line

In order to protect global transfers, companies need to ensure that they take the proper security precautions to ensure that the money is kept safe and reaches the destination unscathed. With fraud and theft increasing at an alarming rate, new technologies are being scrambled together to counter these hackers.

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Credit Card Safety Policies for Your Store

Dec 22, 2016 by

Credit Card Safety Policies for Your Store

Credit card machines have evolved to provide better security for the payment information passed to and from your bank to a customer’s account. Behind-the-scenes, you don’t really need to do much other than setup the account properly and test it to make sure it works. Still, it’s important to have good security policies you can use for employees in house.

Limiting Exposure

Your credit card processor will handle of the sensitive data, but your employees should try and limit the amount of times where they have to deal with the full number for a card. Avoid keying things in, or require manager approval when typing a credit card number into the terminal, and never have employees write this information down. If they need to call a customer’s card provider, or leave the terminal for any reason, the customer and card should accompany them.

The less time you spend with sensitive data, and the fewer opportunities you have to record that data, the better for you and the liability your company faces.

Tracking Terminals

Every employee should have some kind of login ID they use to sign into your store’s credit card terminals. That login should tell management who used a terminal, so you can lookup transactions and identify who rung them up if something goes wrong.

Final Thoughts

If you’ve not already done so, upgrade your store’s payment system so you’re utilizing modern technology. Then, enable chip readers at the register so you can take the more secure form of payment instead of the outdated magstrip.


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Know the Lingo: Basic Terminology for Merchant Accounts

Jul 12, 2016 by

When you’re trying to research something new, like credit card processing, you’re going to need some foundation for the lingo so you understand what is being discussed. There are many terms related to merchant accounts, almost too many to list in a single article, so these terms are some of the most important. After reading this guide, you should have a firm understanding of terminology you can use to help find the best merchant account for your business.

Merchant Bank

The merchant bank is responsible for providing the means to facilitate a transaction, also known as a payment gateway. They may not design that gateway, but they allow customers to utilize it in order to securely send money online or in-store. Aggregators, like PayPal, design their own solutions and allow transaction processing without the “bank” nomenclature.


The processor is the middleman for your transaction, which routes the credit information. When you slide a card through a credit card machine, the processor passes the information to the gateway that sends the data to the merchant bank.

Issuing Bank

The customer’s bank, or the bank issuing funds to cover the costs of the transaction (including the purchase, and associated taxes). These institutions give credit cards to consumers, and usually pay the costs up front while charging customers interest to pay those costs back.


Secure Sockets Layer, a form of encryption that helps anonymize and protect financial data as it is passed from the issuing bank to the merchant bank.


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