10 questions you should ask when selecting a fraud prevention solution
1. Does this platform have proven experience in my product's vertical?
Tip: Generally you will want to look for a fraud protection platform that has proven experience protecting products in your field vertical - as the behavior, fraud schemes, and fraud pressure vary depending on the type of product you sell (physical goods / digital gifting / gaming / ticketing / travel / software etc)
2. What will my acceptance/decline rates look like?
Tip: It is important to get a clear indication of acceptance/decline rates that you can expect after implementing the fraud protection platform - as often avoiding fraud means a high decline rate, which is something a retailer should look to avoid.
3. What is the connection between the fraud platform and our current rules/limitations? Can I remove the current rules and friction those create when launching the platform?
Tip: Many fraud protection platforms are built on machine learning and AI principles, which should help replace the static limitations and rules you have in place that are adding friction to your legitimate buyers and negatively affecting your conversion rates. Many fraud tools still use static rules, which is something to be aware of.
4. How complicated is the integration process? What are the costs and timing? Is model training necessary?
Tip: Before considering kicking-off the journey of onboarding a new fraud protection vendor, it is important to understand what resources you will need to dedicate to the integration, the expected time-frame, and if the platform will want to implement a training process on your data before going live (suggested so that the fraud platform can gain a strong understanding of your unique buyer’s behavior).
5. What kind of transparency is there? Will I be able to see the results in real-time? Will I be able to understand the reasoning for rejected transactions?
Tip: Even if the fraud protection solution you are vetting is able to deliver on all it’s promises, it is crucial to have a finger on the pulse of various fraud-related data points - such as acceptance/decline rates, fraud rates, and reasonings for each declined transaction.
6. I have a list of good buyers, how do I know they won't get declined? Is it recommended to have a kind of White List?
Tip: It is important to see how the vendor does this, as the fraud platform needs to protect against account takeover schemes as well - where even your most legitimate buyer’s accounts are taken over by fraudsters. White Lists are valuable somewhat, they can get tricky and need to be analyzed as well.
7. What kind of data do you collect? Are you GDPR/PCI compliant etc?
Tip: Best to ask about compliancy requirements at the beginning (on the first call) rather than getting far into the vetting process with potential fraud protection vendors that are not sufficiently experienced in managing the data that they are storing as needed by your countries laws and regulations.
8. Is there any guarantee for acceptance rates? Chargebacks?
Tip: Some fraud protection vendors will offer guarantees for acceptance rates and/or a chargeback guarantee. Having your fraud protection vendor aligned with your interests as a retailer (tied to a high acceptance rate and manageable chargebacks) is ideal.
9. Will this platform replace our manual review team? By implementing this platform will we be able to save on our manual review costs?
Tip: Reviewing transactions manually is not ideal, especially in the field of digital goods - ask how the fraud platform you are vetting will help reduce or eliminate the costs and complications of your manual review process.
10. Will we see a higher conversion rate with your tool? How much additional revenue?
Tip: Though not an obvious question when focusing on protecting against fraud, the best platforms will help reduce the static rules/limitations that are causing friction for your buyers - leading to a clear uptick in your conversation rates, resulting in additional revenue almost immediately. Ask the vendor what kind of improvement to your bottom line you can expect, based on their experience with other clients.