As travelers’ demands shift towards a contactless customer journey, chances are you already accept online payments for your tours. To stay competitive and up to date in this space, you need to consider these two critical aspects:
- The first is to ensure that your payment platform is secure and protects your customer’s data when they purchase online.
- Next is to be aware of and avoid potential chargebacks that hurt your business.
At WeTravel, we take the security of financial data seriously and have state-of-the-art financial data and information handling systems in place.
We do not store any financial or sensitive user information on our servers. Furthermore, our payment provider, Stripe, is one of the world’s most renowned providers and is a PCI Service Provider Level 1.
You can learn more about this in our help article here.
Emerging Instances Of Credit Card Fraud
We previously touched on credit card disputes in this blog post.
In the article, we addressed what credit card disputes are, what scenarios you might encounter if you sell tours, and what you can do to prevent them.
However, another type of dispute has begun to emerge in the past few months with the COVID-19 pandemic: disputes related to stolen credit cards.
The global move online has meant that more financial transactions are taking place in the card-not-present (CNP) space. This has opened the doors for scammers to obtain credit card details and commit payment fraud illegally.
Disclaimer: Note that multi-day tour operators and organizers are NOT regular victims of this type of fraud.
In fact, 90 to 95% of the fraud that happens in the multi-day space is friendly fraud and not related to stolen cards.
Tour operators are low risk because they typically sell their own tours or services well in advance using a secure payment platform.
Generally speaking, those most susceptible to stolen card fraud sell last-minute services or add-ons outside of what they usually offer. Fraudsters can take advantage of the short delivery time and disconnect from the direct supplier.
In any case, it is still important for you to be aware of what this looks like and know how to protect yourself in the unlikely event it happens to you.
You can read more about the common types of online fraud in this article. It will bring you up to speed on how scams operate and what your liabilities are.
What Are The Potential Consequences For Businesses?
If your business isn’t using a secure payment platform like WeTravel, your clients’ financial data might be insecure. Fraudsters will see this as an opportunity to steal credit card information and use it without permission.
There is also the chance of someone using a credit card to purchase from you without the card holder’s consent.
Keep in mind that these activities usually happen covertly. So, often the cardholder doesn’t realize their card is lost/stolen/has been skimmed and is being used online.
Provided the scammer submits all the required card and contact information, your payment provider will go ahead with processing the payment.
Once the cardholder does realize what’s happened, they then approach their bank with a dispute to reverse the card payment you received.
These situations can result in your clients losing trust in you. Not to mention the fact that you end up out of pocket and having to deal with costly chargebacks.
How To Identify High-Risk Transactions
The most important thing to understand about scammers is that they want a high-ticket product or service, and they want it fast.
Some of the typical businesses that are susceptible to this type of fraud include:
- Online gambling and casinos
- E-commerce retailers
As we mentioned above, although all online payments come with a risk of fraud, not all businesses are considered equally prone when it comes to stolen cards.
If you are a tour organizer/operator selling regular tours or selling them far in advance, you have a low likelihood of being a target for fraudsters, provided you stick to your standard products and services.
Here are some tips on how to prevent credit card fraud in your tour business.
Credit Card Fraud Prevention Tips For Tour Operators
Stick To Selling Your Own Offer/Product
Tour operators who sell their own tours or products far in advance are at low risk of fraud. You can protect yourself further by sticking to this pact and not selling other services outside of what you usually offer, such as last-minute external add-on packages or tickets for an ‘extra commission.’
Be Wary Of Unusual Or Large Requests With A Tight Deadline
Scammers rush to receive or use their purchased services or goods before being discovered by the cardholder and authorities. Because of this, your tour packages happening months from now are generally safe from this type of scam.
Instances where you might need to verify transactions are if you take in any high-value amounts for last-minute things such as hotel nights or international flight bookings due to happen imminently.
Identify Unusual Client Profiles and Behavior
Watch out for so-called clients who contact you from weird email addresses, ask for unusual requests, or make requests from alternative contact details to what you have on file. These sorts of interactions could be a sign of a hacked or fake customer profile.
Never Perform Refunds Outside Your Payment Platform
There are several types of payment scams that fraudsters may use when performing credit card fraud. For example, they might use stolen credit card details, make an overpayment and then request a refund, or ask for an alternative refund.
A quick bit of advice here is:
- always refund customers to the same card they paid you from
- never send money on to a third party for a client
- stick to the payment platforms you are familiar with
Note that with WeTravel, you can process refunds to the original payment method for free.
What To Do If You Suspect A Payment Is Fraudulent
If something feels out of place and you suspect a payment is fraudulent, there are actions you can take to protect your business:
Delay Your Service and Ask For Additional Information
Ask For A Photo ID Of The Person Requesting The Transaction
This should match the card holder’s name and the end customer who will receive the service.
Contact Your Payment Provider
If you find yourself in an unusual situation or confronted with an odd request, before making any decisions around providing a service or sending a refund outside the platform, contact your payment provider. Get more information about the transaction in question to cover your bases and make an informed decision about what to do next.
Decline The Service and Process a Refund
If you cannot verify the validity of a transaction or a person’s identity, there is always the option to decline the service and process the refund. If you refund the payment, it can’t be disputed.
As we mentioned earlier, just ensure the refund goes through your original payment platform.
COVID-19 has spurred an increase in credit card fraud. Unfortunately, it’s not always straightforward to pick up when a scam is happening, so businesses can land up with unexpected disputes lodged on transactions that were seemingly approved.
The likelihood of stolen card fraud happening to tour operators who stick to their services and offer trips far in advance is low. Certainly, you don’t want to be so wary that you end up turning down legitimate transactions
But, by arming yourself with knowledge on the subject, you can protect your business. Ultimately, you are responsible for the happenings on your platform. Because you possess customer information and details of the purchase, you are the best person to decide whether a transaction is potentially fraudulent.