When a business accepts a credit card payment, it is bound to a set of rules that are detailed in operating guides of all merchant accounts. Adhering to the policies associated with credit card processing protects customers, employees, and businesses from malicious activity. Following the contractual responsibilities of merchant accounts keeps data secure, prevents incidents of fraud, and avoids chargebacks. Failure to sustain accountability in these regards results in fines, convictions, and potential merchant account closure.
The payment card industry data security standard (PCIDSS) is the standard of protection agreed upon by the major credit card brands. Meeting the PCIDSS’s twelve basic policies is required of all merchants that store, process, or transmit cardholder data. Without safeguards, credit card processing is vulnerable to intrusions that expose customer data. It is important that businesses of all sizes achieve and maintain the minimum PCI minimum standards in order to avoid data breaches and the associated penalties.
Vigilance Against Fraud
Credit card fraud comes in several different forms, and businesses have a mandate to adhere to procedures that help identify and impede attempts to use wrongly use credit card data. In-store transactions, in which the credit card and its owner are both physically present are easier to monitor, but special attention must be paid to online transactions and telephone orders. Acquiring banks and credit associations will penalize or close merchant accounts if they incur too many financial losses from fraud.
Some chargeback situations are unavoidable, but strong business practices will decrease the likelihood of customer dissatisfaction and the resulting complications. Chargebacks cost businesses not only the money from the sale, but fees on their merchant accounts. Like other major violations, too many chargebacks may damage a business’s reputation and make merchant service providers less willing to work with them.
Maintain a Positive Relationship with Merchant Service Providers
Credit card processing is considered a privilege to credit associations and acquiring banks. If a business is consistently unable to meet their standards, the penalties are significant, from fines to the privilege being completely revoked. It is crucial that business owners monitor their statements every month and stay familiar with the policies guiding their merchant accounts.