If you own a small business, then safety will be very high on your priorities, as one fraudulent payment could mean the end of your business if you aren’t careful. This is generally not an issue, and most forms of payment have some sort of safety built into the – chip, and pin payments, for example, are very safe as the customer must enter in the unique pin to use the card. With a virtual terminal or Payment Cloud this isn’t necessary, though, and with just the details on a bank card, a transaction can be completed with the customer even having to be there. This may cause some anxiety with small business owners as it may be easier to commit fraud using this method.

So how safe are phone payments?

In short, payments over the phone are perfectly safe as long as the business is using standard security precautions and that the payer is certain that the company they are paying is legitimate. If either of these is not in place, the answer becomes more difficult.

When looking at the statistics for all payment methods, then you will find that yes, transactions over the phone have more examples of fraudulent payments than card machine transactions. This is not a high number of the overall transactions, but as a customer and a business owner, it is important to understand this. As a customer, you need to be mindful that the company you are paying is totally legitimate and that you trust them, and if you are not sure, then opt to use a different payment method. Most companies have a security protected portal or the ability to take in-person payment if needed, and if the business is resistant to this, then it could be a red flag. In addition, as a business, you need to be careful when taking payments, as if they are not legitimate, then you may find yourself with chargeback fees.

How to prevent fraud when taking payments over the phone

There are a few key ways you can maximize the security of your over-the-phone transactions. The first is to ensure that you are PCI compliant, which is short for Payment Card Industry Data Security Standard. Becoming compliant means that you need to meet requirements for how you store, transmit, and process card data. To become compliant, you will need to speak to your payment processer who may be able to cover this for you, or you will need to go through the process yourself.

You will also need to maintain standard security systems, which means getting all the necessary information from a card before processing the payment. You may also need to implement a method of verifying someone’s address before taking payment to make sure that it matches what is on the system.

Finally, trying to maintain a culture of security in your business will go a long way. There is often a tendency to trust staff in a small business, but this is where errors can be made. Try to make sure that staff are all trained on the correct processes and know the ramifications of these processes being broken.