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The Holiday Prep Season is Already Here for Merchants (and Fraudsters).

For many, the “holiday season” begins when we gather for a Thanksgiving feast at the end of November. But according to the National Retail Federation, the majority of people actually begin their holiday shopping earlier. In fact, 59% of consumers polled said they had already started gift shopping in early November! 1

In order to get ready for this busy time, business owners should start preparing for the holiday rush in October (if not sooner). You’ll need to get more supplies, increase your inventory, plan your marketing strategies, communicate with your vendors and, of course, engage with your customers.

But there’s one holiday prep task that might not be so obvious — revisiting your fraud prevention plan. While the holiday season brings an influx of new sales opportunities, it also brings increased fraud risk. It is crucial that you take the time to guard your business (and customers!) during the holiday season.

Fraud around the holidays.

Fortunately for business owners, the global pandemic had little impact in holiday spending — in fact, spending actually increased in 2020. Unfortunately, an increase in transactions comes with an increase in fraud. And over the last year and a half, we’ve seen an even more substantial increase in fraud attempts across all industries.

It’s important that you and your staff are vigilant, because even one slip-up can be devastating to your business. As you start to make your holiday plans, bake in some extra training time to go over the basics (and not-so-basics) of fraud:

  • Know the red flags of common scams
  • Be able to spot a phishing attempt
  • Keep an eye out for fraudulent cash
  • Ensure you’re following PCI guidelines

The true cost of fraud.

These days, consumers have endless options. Competition is stiff, and consumers can afford to be picky about where they shop. If they make a purchase, they want assurances that their personal information will be safe. After all, their names, addresses and payment details are precious.

If your business is not PCI DSS compliant, you’re gambling with a lot more than just money. A data breach could cause you to lose your customers’ loyalty, your brand’s reputation, money, and in some cases, your entire business.

A popular scam to look for.

Fraudsters get more creative each year, so vigilance is key. A common scam we’ve seen recently involves “card not present” transactions.

This type of scam typically happens over the phone or online, when the fraudster is not physically at the point-of-sale. Through the use of malware, the fraudster illegally obtains a victim’s card details and uses that information to make purchases. If you don’t do your due diligence as a card-accepting merchant, you could be on the hook for those costs.

Stay protected against fraud.

The best thing you can do to protect your business is to stay PCI DSS compliant. PCI DSS is mandated by credit card companies to help ensure the security of credit card transactions. Specifically, it refers to the technical and operational standards that businesses need to follow to protect credit card data.

Being PCI compliant will help you avoid fees and fines if a breach should unfortunately take place. If you are not compliant and private customer information is ever compromised, you’ll be on the hook for those stolen funds and more. You may have to pay back your customers, their banks and face a potentially hefty fine. These fines cripple, and in many cases, completely close businesses every year.

Take an extra step against fraud.

Maintaining PCI compliance (and other forms of fraud protection) can feel very overwhelming, especially for small businesses during the busiest time of the year. While any merchant services provider will give some instructions on how to get compliant, we recommend choosing a provider that will truly guide the way. Commerce Bank puts a large emphasis on fraud prevention for this very reason.

We have an in-house, PCI-focused team designed specifically for our small business clients. They will be able to walk you through the steps you need to take to get compliant, provide the tools to help you maintain your compliance, and even help train you and your staff on fraud trends over time.

Commerce Bank will help you get compliant and stay compliant by guiding you through these initial steps:

  1. Determining your PCI level
  2. Understanding penalties for failing to meet standards
  3. Completing a self-assessment questionnaire
  4. Building and maintaining a secure network that protects cardholder info
  5. Filling out a formal attestation of compliance
  6. Filing paperwork with credit card companies

Start preparing now!

The holiday season starts earlier than you think. Make sure you’re prepared for the increased spending, customer traffic, and potential fraud by working with Commerce Bank before the holiday season starts. To get started, visit your local Commerce Bank branch, or connect with our knowledgeable PCI compliance team.

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