Running an online store comes with real risks. Fraud, chargebacks, and sudden flags from your payment platform can hit out of nowhere. The trickiest part? Knowing what actually works to keep your payments secure, without scaring away real customers. Our guide cuts breaks down the tools that help merchants stay protected while keeping sales flowing.
The Problem With “Secure” Payment Systems
Some merchants go overboard trying to stop fraud and end up locking out good customers. Others take a hands-off approach and wind up with a flood of chargebacks or even frozen accounts. Neither path works long-term.
What does work? A layered, flexible approach. You need tools like 3D Secure, CVV verification, and filters, but use them in a way that fits your store’s behavior and risk level. Let’s get into what that actually looks like in practice.
A Clear Checklist for Smarter Online Payment Security
1. Turn On CVV and AVS Checks
- CVV (Card Verification Value) confirms the three-digit code on the card. It blocks a lot of low-effort fraud, especially from bots or leaked card numbers.
- AVS (Address Verification System) checks if the billing address matches what the bank has on file. It helps spot red flags, especially with international cards.
Instead of declining every mismatch, flag them for review or use scoring logic to decide when to allow a transaction.
2. Use 3D Secure (3DS) When It Counts
3D Secure gives you a major advantage: when the cardholder authenticates the transaction through their bank, liability for fraud shifts to the card issuer. That means fewer chargebacks on your plate.
But 3DS adds a step to checkout, which can annoy customers or tank conversions if you use it everywhere.
Best approach: apply 3DS to high-risk orders like large purchases, first-time international buyers, or anything that looks out of the ordinary. Skip it for known returning customers or fast mobile checkouts.
3. Set Up Velocity and Volume Filters
Velocity filters look for patterns that don’t make sense, like:
- The same IP address submitting multiple orders in minutes
- A new account placing three high-value purchases right away
- Dozens of failed card attempts in a row
These filters help stop fraud before it finishes checkout.
Set limits that make sense for your business. Don’t let a rigid rule block legit orders from group settings like schools or offices.
4. Use BIN Data and Country Controls
The Bank Identification Number (BIN) on a card tells you what type of card it is and where it was issued. This data is useful if you’re selling in one region and see cards from another.
Things worth reviewing:
- Shipping and card country don’t match
- Prepaid or gift cards are used on high-ticket items
- The BIN comes from a region linked to frequent fraud
Don’t block every case, but flag the ones that raise a question before you ship.
5. Score Transactions—But Don’t Let Automation Make Every Call
Most processors give you a risk score for each transaction. The higher the score, the more likely the order is fraudulent. But relying on default settings can lead to false declines.
Adjust thresholds based on what you learn:
- Use past chargeback data to update your rules
- Whitelist long-term, repeat buyers
- Review transactions that fall into the gray area
Aiming for zero fraud usually means declining too many real customers. Find a threshold that keeps fraud under control while letting good orders through.
6. Check the Checkout Experience Often
Security tools change behavior at checkout. If you’re adding new filters or verification steps, test the full flow like a buyer would.
Ask yourself:
- Can your best customers complete a purchase smoothly?
- Are good orders getting declined for no clear reason?
- Has your payment provider started flagging transactions that used to go through?
Small friction points can lead to abandoned carts or support tickets. Keep the experience clean.
Final Thoughts: Don’t Let Security Hurt Your Sales
You need to protect your store, but you can’t do that by blocking every unusual order. Fraud protection works best when it’s tuned to your specific risk profile, not someone else’s template. That means using the right tools (AVS, CVV, 3DS, filters) but adjusting them as your business grows. If chargebacks are creeping up or conversions are falling, it’s a sign that something in your setup needs a closer look.
FAQ: Online Payment Security for Merchants
What is online payment security?
Online payment security refers to the systems and strategies that keep ecommerce transactions safe from fraud, chargebacks, and unauthorized access. It includes things like fraud filters, identity checks, and transaction scoring.
How does 3D Secure protect merchants?
3D Secure authenticates the customer through their bank, which transfers fraud liability to the card issuer. That means if the buyer confirms the transaction and it turns out to be fraud, you’re less likely to be hit with a chargeback.
Should I block every AVS or CVV mismatch?
No. Mismatches happen for plenty of reasons—typos, outdated billing addresses, or customers using shared cards. Blocking all mismatches can drive away legitimate buyers. Flagging them for review usually makes more sense.
Are too many fraud filters a bad thing?
They can be. When filters are too aggressive, they start blocking good transactions. This hurts your revenue and frustrates your customers. It’s better to use layered rules and monitor how they perform over time.
Can fraud checks be automated safely?
Yes, if you customize the automation. You can set up rules to allow, review, or block based on risk scores and behavior patterns. Just make sure to adjust those rules regularly using real transaction and chargeback data.
Cut Fraud Without Cutting Sales: Why Merchants Use Chargeblast
Too much fraud? Too many filters? Not enough clarity? Chargeblast helps ecommerce merchants bring everything together through fraud tools, payment alerts, and chargeback defense, all in one place that actually makes sense. Instead of chasing disputes after they happen, we help you stop the ones you can’t afford to lose.
Start tightening your fraud setup the right way by booking a demo below.
