False positives:
The big problem you didn't know you have
Online:
Card not present
Online there is no physical card nor PIN. There’s only the information contained on the card, which anybody can enter.
There is no categoric way to prove that the person entering the card details online is in fact the card holder.
This is why there are $40 billion in fraudulent online transactions taking place every year.
In-store:
Card present payments
In-store, payments are made with a physical card and, depending on the size of transaction – a PIN. Chip & PIN has been around for a couple of decades and has unquestionably proven to be the safest way to take payments.
No matter the sophistication of a fraudster, they cannot read minds to obtain someone’s PIN.
65%
of transactions that anti-fraud AI solutions block are false positives
41%
of customers won't shop again with the merchant after a false positive
$13
is the total loss to the merchant for every $1 in false positives
The in-store vs online payment process looks something like this:
CPoI eliminates 100% of false positives
By using CPoI as your preferred way to accept payments online, you can remove all the above problems. No more fraud, no lost sales, no unhappy customers, and expensive admin costs. Just simplicity and increased revenue, allowing you to concentrate on growing your business.
The benefits are vast:
✅ Decreased fraud
✅ Reach a wider demographic
✅ Decreased settlement time
✅ Increased customer protection
✅ Frictionless payment experience
✅ Increased customer satisfaction
✅ Protects brand reputation
✅ Increased revenue by 100% eliminating false positives
✅ Decreased running costs and regulatory requirements
✅ Reduction in administrative work and fees
✅ Greener solution, CPoI is the only app required (currently an average of 5 AI fraud tools are used)
These problems don’t exist for physical stores
Physical stores don't have any of these problems or costs. Provided the cardholder has adequate funds, the merchant gets paid. Simple!
Here’s why:
If the anti-fraud solutions that merchants use to detect fraudulent transactions identifies a high-risk sale, it will not allow the sale to proceed. But there is a very high chance that the majority of the transactions the anti-fraud system deems as fraudulent (and therefore blocks), are not fraudulent at all.
This is called a false positive.
This article by Mastercard details just how big a problem false positives are.
The harsh reality is that you’ll never know exactly how many false positives you have, because these sales never reach you.
Mastercard’s figures state that up to 7% of a merchant's sales can be blocked with anti-fraud AI solutions, severely restricting merchants' revenue, creating a negative customer experience and ultimately resulting in reputational damage for the merchant.
The AI can (and does) get it wrong, often
Anti-fraud technology can negatively impact the CX
The customer experience gets even worse if a merchant employs all the recommended protection systems such as 3DS and 2FA, which can have abandonment rates as high as 65%.
All this ultimately leads to a genuine customer not being able to make a genuine purchase when and where they want, and overall, one very unhappy customer.
Research shows that if a customer has a single refused transaction with a merchant, 60% will never shop with that merchant again. Have a read just how significant this issue can be for sectors such as travel.
