Just when you thought it was safe to go outside, yet another new payment method arrives on the scene. I follow at least a dozen different news sources and being in the payments biz for 30 years I get a lot of whispers sent my way too. I would strongly suggest that you seriously consider the consequences of leaping at every new payment method with the hope it is going to be the “killer app”. There is a point of diminishing returns in terms of upside. Offering more than 3-4 types of payment or multiple brands of the same basic scheme will lead to confusion at check-out. And, your customer service department with thank you!
Author Archive for Steve Klebe
Chaos in the Payments Biz
Thursday, May 6th, 2010 | Tags: Payment Posted by Steve Klebe in Payments 101.201.301 | No Comments » |
Do Not Assume Payment Methods Are Universal! Neither Demographically or Geographically!
Tuesday, April 13th, 2010One of the challenges we all face is being able to step out of what works for us and understand what any one or group of our customers is going to have a preference for. This is especially true for payment choices. The closest thing we have to “universal” in ecommerce is Visa/MasterCard. But, if you are selling to Germans, you better support something called ELV which is a form of direct debit or move on to another country. And, as a person with a marketing degree I have a hard time saying this, but surveying your customers to ask them what payment methods they want or what is most important about those choices, may lead you down the wrong path. What people say they want and how they act in this regard can be significantly disconnected. ie; Is security important to you? Who is going to say “no”? But, many payment methods have fallen flat on their face if the hurdles to usability are significant due to security. What was one of the things that made PayPal grow incredibly fast? All you needed was an email address. Of course, their fraud rates were through the roof too but they had the luxury of taking in a whole bunch of VC money and being able to tolerate the cost and eventually they dug themselves out of the hole. Two of the most important questions you have to ask yourself are; 1) what is my target demographic and 2) what geographies do I want to serve?
| Tags: payment ecommerce Germany Posted by Steve Klebe in Payments 101.201.301 | No Comments » |
No Silver Bullet…But CVNs Make Sense…The Time Has Come!
Wednesday, April 7th, 2010Card Verification Numbers (CVN), those 3 digits on the back of a Visa, MasterCard and Discover Cards and the 4 digits on the front of an AMEX should be taken advantage of. Aside from the confusing acronyms from each of the card brands (CVV, CVC, etc.), their time has come. When they first arrived on the scene, consumers were confused and this may have led to some abandonment. Now it appears, that merchants who do not ask for them may be risking abandonment. While far from perfect, and nothing is, there is no question that successful authentication of the CVN does provide significant fraud prevention and remediation benefits. It is true that the card skimmers of the world now capture the CVN too and when card numbers are sold on the Internet (or in some back alley), ones with valid CVNs fetch more dough. As with all fraud prevention and remediation efforts, you have to take advantage of multiple layers. In the physical world, the holograms that are applied to cards were counterfeited within weeks of their introduction but it is one more thing the bad guys have to deal with, it increased the cost to commit fraud and continues to keep the casual fraudster at bay.
| Tags: CVC CVV Fraud Authentication Posted by Steve Klebe in Payments 101.201.301 | No Comments » |
Selling Digital Goods and Fraud Prevention
Monday, April 5th, 2010You may find this article of value, I did. http://www.insidesocialgames.com/2010/02/24/selling-digital-goods-stay-safe-and-reap-the-rewards/comment-page-1/#comment-13010 I just posted a comment about the use of CVNs (Card Verification Numbers). When they were first introduced, they confused people, but now some research I have seen shows that not asking for it can lead consumers to wonder if they are on a real site. Often, these new features are launched to much fanfare, go through a period of doubt, then at some point usually after the pundits have moved on, they actually matter.
| Tags: CVN CVV CVC Fraud Posted by Steve Klebe in Payments 101.201.301 | No Comments » |
Genuine progress in fraud prevention!
Tuesday, March 30th, 2010Wells Fargo announced a few days ago that they were taking advantage of a new Visa feature. Of course, I had to immediately enroll. You then receive text message alerts when certain types and size of transactions occur. The idea is that if it isn’t you, you can immediately respond and become part of the fraud prevention paradigm. I was somewhat skeptical, as usual, but as it turned out hours later I was picking up my wife’s BMW from the shop (ouch $1200!!!) and while I was still standing at the check-out desk, my phone got a text reporting the transaction to me. It was very descriptive, telling me that my “Wells Fargo Card ending in xx was used at xxx Motors in xxx town for $xxxx.xx ….
This is real progress.
I had previously enrolled in their alerting offer but due to the number of different acquirers and issuers and the batch nature of credit card processing, these often did not arrive until days later.
Since, Visa’s switch is involved in the authorization of all Visa transactions, these alerts can go out literally in real time.
Of course someone will try and call this a mobile payment! (see my article in Venture Beat!)
http://venturebeat.com/2010/03/10/what-will-it-take-to-make-mobile-payments-mainstream-in-the-us/
| Tags: Fraud Posted by Steve Klebe in Payments 101.201.301 | No Comments » |
