Credit card fraud can cause irreparable damage to a business credit score. In the case of small businesses, this could shut down a company's entire operation. That's why vendors must ensure they are working to ensure their customers do not fall victim to fraudulent activity.
It isn't just the customer that suffers from credit card fraud. If a vendor cannot control the information it processes, its reputation could take a serious hit. According to a study from Javelin Strategy & Research, credit card fraud has increased 87 percent since 2010. In an era where PCI compliance is so important, vendors must take proper steps to keep this from occurring at their organization.
An article in the online publication National Law Review illustrates the importance of avoiding credit fraud and offers a number of tips to prevent it. One of the key points made is that sometimes, breaches will happen regardless of the preventative measures taken and that companies must do whatever they can to handle them right away.
"It's critical to understand that even if all cautious, conservative steps are taken and the best payment processing security is installed, a breach can still occur," the article says. "If it does, you must have detailed credit card sales records to refer back to as a means of retracing your steps. This will help in determining when and where the breach took place and therefore mitigate the potential for additional losses. A proper assessment of the initial attack may ultimately provide a trail back to the source of the breach."
Of course, vendors that invest in a tokenization solution will be able to go a long way toward preventing this from happening in the first place. By protecting customer data from targeted attacks, vendors can mitigate the negative consequences of credit card fraud.