Card not present transactions are only becoming more common in the payment processing industry, which is both good and bad for merchants. On one hand, it makes it easier to find customers and provide valuable goods and services to them, and it gives merchants the chance to expand their business at a fairly low cost. On the other hand, these transactions can actually be pretty risky for merchants simply because it’s so difficult to ensure that every single card not present transaction process is completed with a legitimate buyer. When these fraudulent charges do occur, it falls on the merchants to cover the costs — this is known as a chargeback.

So how exactly can merchants reduce their risk of card not present chargebacks and know that they’ve got a secure payment processing system in place? Here are just a few suggestions:

• One reason why these transactions get so expensive and risky for merchants is that it can be difficult to track whether or not the products purchased were actually delivered. Using a payment delivery verification and a product delivery verification service ensures that customers won’t claim that they paid for a product but never received it.
  

• If you’re worried about fraudulent charges resulting from identity theft and stolen credit card information, you can bolster your payment processing system before the transaction even takes place. It’s a good idea to ask for customers to input the card number and the security code on the back, and you can flag any orders where the payment address is different from the delivery address (and then double-check that they’re legitimate orders).
  

• International orders can also be a source of fraudulent charges, so many business owners choose not to accept overseas orders at all. If you choose to accept international orders, you can take preventative measures like requiring an order confirmation via email or telephone, and you can flag any orders that are extremely expensive.