Why Midsize Companies Should Outsource Credit Card Fraud Management
As your business grows and your sales increase, are you ensuring your fraud management approach is keeping pace?
If you’re not, you should.
Fraud protection in today’s digital age has certainly gotten complicated. And while some companies opt to keep it as an in-house service, many are making the smart switch to outsourcing.
But why is outsourcing credit card fraud management considered a “smart switch,” and why might it make sense for your growing business?
3 Reasons to Consider Outsourcing Your Fraud Management
Merchants of every size are vulnerable to the growing threat of card-not-present (CNP) fraud, but smaller businesses with an in-house fraud prevention program have more to lose. As a result, outsourcing fraud protection can be a valuable approach for those looking to supplement, validate and improve their fraud management practices. Why? We’ll share three reasons.
1. Saves Time and Money
When you select a reliable fraud management partner, you can refocus your resources on tasks that are more critical to your business. Then you let the outsourced company:
- Build on and use its extensive database of insightful, relevant data
- Quickly spot and analyze suspicious transaction patterns
- Identify and stop fraudulent transactions before they’re processed
Why else might a business want to use an outsourced team? This strategy:
- Minimizes the time and cost needed to build a fraud management team. With an outsourced solution, businesses significantly reduce the time, energy and expense needed to get fraud management experts up and running. There’s no down time for recruiting, hiring and training staff and implementing a program—you gain an immediate team of specialists who are well-prepared to combat fraud.
Although it’s true that an outsourced security solution is an expense for your business, it’s one that would likely pay for itself in the event of a cyberattack or data breach.
- Eliminates establishing fraud management SOPs. Staffing an in-house fraud management team isn’t as easy as simply hiring staff. Businesses must also build and maintain standard operating procedures (SOPs)—and that requires time and money. Do you want your staff distracted by the task of researching industry trends? Or would you prefer a specialized team implementing already-created SOPs and stopping fraud in its tracks?
- Allows for predictable costs. Through an outsourced partner, you’ll know exactly how much fraud management costs will be in relation to sales volume. This is especially true if the partner offers guaranteed protection. And knowing these figures are beneficial when you are counting on capital to propel your business forward.
When you need to focus your personnel on what really matters—including freeing up time and resources to focus on your business’s core processes—outsourcing your fraud management solutions is clearly a smart idea.
2. Easily Handles Peaks in Sales Volume
Sure, your staff can probably handle the current volume of fraud management—but what happens when sales peak and valley? Are you convinced your staff can handle peak sales times, like Christmas, when fraud and sales are at all-time highs? And if you don’t, what’s your strategy?
It’s difficult to properly staff a fraud protection team if you experience seasonality in your sales. Would you hire seasonal help? Would you temporarily outsource part of the work? Either solution could dramatically affect your team’s ability to effectively screen transactions and provide proper coverage. Is that a risk you’re willing—or able—to take?
By outsourcing, you’re guaranteed that staffing will always be appropriate for the season and their dedication won’t vary with sales.
3. Offers Chargeback Guarantees
Would you rather focus on growing sales or paying expensive chargeback fees? We’re sure we know the answer.
Without total guaranteed protection, your business is on the hook for the total refunded amount plus expensive chargeback fees that often add up to more than $75 per dispute. But with chargeback guarantees, you’re covered even if a fraudulent transaction slips through the cracks.
This is a huge advantage to business owners of all sizes who are concerned with securing their businesses. High chargeback rates can quickly damage reputations and bottom lines; an outsourced solution with guaranteed protection also:
- Helps you easily defend yourself against card-not-present fraud
- Gives developing businesses the confidence to enter international markets without assuming extra fraud risks
Ready to Consider Outsourcing Your Fraud Management?
Fraud protection is complicated. Don’t make the solution complicated, too. If you decide to use a third-party protection solution, make sure you do your research to differentiate among the competitors—it can mean the difference between an ineffective fraud defense and a comprehensive, strategic plan.
Considering outsourced security solutions is a decision to be taken seriously. With your growing business, this approach lets you concentrate on your core business without worrying about the burden of chargebacks and fraud.To learn more about how outsourcing your fraud management solution can help your business, talk with one of our fraud protection analysts. Email us at email@example.com to get started today.