Fraud committed in the UK increased by over 50% last year, rising to £2.3 billion. This poses a serious threat to SMEs, as they are seen as an easy target for fraudsters. If you are a small or medium-sized business owner, here are UTP's tips on how to prevent fraud.
UTP has been helping SMEs succeed in taking card payments for over 10 years. UTP is an ideal card machine for business that make the most of every sales opportunity with fast card payments. They offer a range of products and services to help your business get paid faster, smarter, and safer. They offer their anti-fraud software to their customers. But first, it is important to understand the types of fraud SMEs face.
Types of fraud
The most common type of fraud for SMEs is interpretation scams. This is where criminals attempt to impersonate a CEO, manager, or supplier to convince staff to share payment details. According to a Take Five to Stop Fraud survey, 80% of SMEs received these unsolicited messages. Online phishing attacks are very common for SMEs around the UK. This type of fraud usually comes in email form, directing you to download an attachment or press a link.
Once you open the link or attachment, you expose your business to potentially harmful malware. This can then compromise banking details, personal data and even client information. For brick-and-mortar stores and businesses that sell online, card and cashback fraud is also common.
Card fraud is where shoppers use lost or stolen cards to pay for goods and services. Chargeback fraud usually happens online. Fraudsters buy something from your eCommerce store, and then when it arrives, they claim it either didn't arrive or was damaged. Instead of going to your store to report the issue, they go straight to their bank.
It is harder to dispute online chargebacks. In most cases, the bank returns the money from your business’ bank account to the fraudsters.
For some SMEs, you may already be aware of these tactics used by fraudsters. Or for some of you, this may have opened a whole new jar of worms. Here are UTP's tips for avoiding fraud:
1) Educate your employees
Educating staff is one of the most important steps to ensuring your business remains safe. Properly trained staff can monitor and report any suspicious activity. You should inform your staff of what information is expected to be shared in messages. By doing this, it sets the rules of what information your employees know they can share and what is acceptable to ask for.
You should also make your staff aware of trending scams and fraud attacks. UTP recommends that you give clear and simple guidance when it comes to fraud. What is obvious to some people may not be as obvious to others.
2) Accurate record-keeping and regular audits
All records should be managed and stored accordingly. This ensures that no loose paperwork gets lost and falls into the wrong hands. You should also dispose of paperwork properly. UTP suggests shredding, manually destroying or using professional confidential waste services. Although it sounds simple, ensuring your business has regular audits is important. This gives your business the chance to cross-examine transactions and spot any unusual activity.
3) Protect your transactions
Remember smarter and safer payments? That's down to UTP Shield. This is UTP's free software that detects suspicious transactions, both in-store and online. UTP Shield works by understanding what the average transaction in your business looks like. From normal payment methods to average transaction amounts and trading times. UTP will then notify you by email or text once they pick up suspicious activity.
It also detects transactions that carry a high chargeback risk. When they flag a transaction, your business is then able to decide whether to accept or decline the order. This puts your mind at ease when it comes to transactions and allows you to focus on the other issues we raised.
