Reduce Chargebacks with Bank Identification Numbers
Here is method that help to lower the number chargebacks
A Banks identification number (BIN) is a set of first four to six digits on a credit card, debit card, electronic benefit card or a charge card, used to identify the issuing Institution and its address, type of card and other details on the card.
Learn what you can do to reduce chargebacks and prevent fraudulent transactions when selling online. An increase in global transactions and movement of people requires critical and accurate matching information about the transactions between the merchants or card holders, card issuing institutions, and the banks being used for transactions. For example, a misunderstanding may arise where by a merchant withdraws more funds than agreed upon in the transaction, from the card of the client.
The client’s issuing bank will forcibly initiate a return of the excess funds to the owner’s bank account, credit card, debit card or charge card. A situation in which excess funds are returned to the owner is known as a chargeback. A chargeback helps reverse a fraudulent transfer. Here is method that help to lower the number of enquiries you receive and reduce the number of chargebacks.
Advantages of Bank Identification Numbers
1. Fraud prevention
Bank Identification numbers help to match information between merchants and their customers so as to avoid fraudulent transactions. A fraudulent transaction that involves a chargeback is more likely to affect the merchant’s business and may lead to a closure of the merchant’s account. In some incidences, criminal investigations will be launched against the business owners with possibilities of prosecution. It is internationally agreed that the customer chargeback ratio should not exceed 2.5%. A bank Identification number helps the merchant to receive notice of excess withdraws and this allows the cancelation of transactions that might be considered fraudulent. The Merchant would also be able to determine the percentage chargeback, so as to avoid a situation leading to the closure of the account.
2. Reduce chargebacks
The growth in online business has been followed by matching proportions in online fraud. There is an increase in the use of fraudulent credit cards ma situation that is likely to affect the chargeback ratios of business owners. A bank identification number will help merchants identify card holders and card issuers. The identification numbers are representative of the issuing company and the bank and this will help you validate the accuracy of the card before approving a transaction.
3. Risk Management
A number of newly opened businesses on the internet are a possible target of fraud organizations. Many tend to receive numerous orders for their good and services from these organizations and may end up making many shipments .Because most fraudulent companies use forged or stolen cards, these businesses will incur heavy losses than may possibly lead to closure and at times high risks of chargeback bank Identification Number is one way a newly opened business owner can prove the identity and accuracy of the destination of the goods. Merchants have a chance to cross check the information of the country of delivery before actually sending the goods. For example, a person credit card issued in London and sending goods to Uganda will have the information crosschecked before the goods are actually sent to Uganda.
Try our online BIN database