The Importance of a Fraud Risk Score
The rise of digital transactions has ushered in an era of sophisticated fraud risk score. These can have an immense impact on a merchant’s bottom line, reputation, relationship with payment processors and card issuers, and other factors.
Fraud Risk Score
Fortunately, there are solutions to combat these new threats. One of the most effective is a fraud risk score, which measures the likelihood that a transaction is fraudulent. The fraud score takes into account a range of factors, from the customer’s email address and bank information to the geolocation of their IP address and whether they are using a proxy server.
When used in conjunction with an automated fraud investigation tool, this can make it easy for teams to investigate suspicious transactions and quickly identify the underlying cause. The fraud risk score also helps prioritize mitigation activities, so resources aren’t wasted on low-likelihood risks.
However, it’s important to keep in mind that a fraud risk score isn’t a “set it and forget it” solution. Fraudsters are constantly updating their tools, and rules need to be tweaked or even completely reworked to stay up-to-date with the latest patterns. As a result, it’s important to continually assess the effectiveness of your fraud detection methods.