What It Means When We Reach out for More Information

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This post was written by Rucha Tatke, a Fraud Analyst on Square’s Risk Team.

Our goal is for all sellers to set up their readers, start taking payments, and never have to think twice about it. But the reality of running a business is that you sometimes encounter issues with your payments. And when that happens, we might reach out and request more information.

You might hear from us if a buyer was unhappy with a purchase, and instead of requesting a refund, decided to ask the bank to dispute the charge. Other times, it’s not a picky buyer, but a fraudulent one. This may be someone using a stolen credit card or someone who never intended to pay for the purchase at all. Fraudsters are also getting more sophisticated, and you may be a victim of account takeover.

Our Square Secure team is the group that monitors all this activity; we’re here to help insulate your business from risk. It’s similar to the way that your bank tries to protect your credit card accounts. So, when we request additional details about your business, we’re just looking for information to protect your business from fraud.

Here’s what’s happening behind the scenes to protect you from fraudulent activity:

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Our system monitors unusual activity 24/7.

Our algorithms flag bad payments as soon as they enter our system, letting us know that your account may be at risk of a dispute.

We may reach out once we’ve seen a flag.

A member of our team might reach out and ask for more information from you (see below for the kind of documentation we look for). Expertise is also added to the process in order to make sure your account is treated correctly.

We try to prevent any loss to your account.

When we request information, we may simultaneously suspend deposits and hold your funds, just in case the payment is confirmed as fraudulent. You can be sure that we’re working behind the scenes to keep your account safe from fraud.

We use the information you provide to protect your account.

The information you provide helps us continue to make better decisions when we catch suspicious activity. Well-documented, timely responses go a long way in resolving issues. We aim to understand your business better so that we can continuously improve our detection process.

How to take charge of your security

Worrying about fraud and disputes can take up your valuable time and energy. While we are constantly working to keep your business secure, there are steps you should take to be proactive too. Here are a few best practices to help you protect your account and keep disruptions to a minimum.

Know your customers.

Just like Square strives to understand your business, you should know your average customer. You can ID customers for in-person transactions, but when handling large online or card-not-present transactions, it’s important to make sure the customer’s purchases and requests make sense. More than anything, trust your gut. If you get strange requests(a money transfer request, for instance), don’t proceed with the transaction.

Documentation and proof of service are your best friends .

You should save receipts, invoices, and contracts up to 18 months after a sale. That way, if you ever need to fight a chargeback, you have all the evidence you and the card company need. If you don’t currently use this kind of documentation to keep track of your transactions, Square offers invoice and contract templates that can be customized to your business. Every transaction you have with Square generates an email that is sent to you, and your Square Dashboard has records of your sales.

Remove the risk of liability with the right hardware.

If you swipe a chip-enabled card on a magstripe reader, you accept the liability for any chargebacks that may occur. This means that even if you follow transaction best practices and keep track of documentation, you can be liable to cover chargebacks and fraudulent charges. With a reader that accepts chip cards and mobile payments, you can accept all cards and reduce your risk of chargebacks. The Square Reader for Contactless and Chip is just $49 — a small investment that goes a long way in preventing future loss.

Square Secure is here to protect your business so you can focus on your next sale. Click here to learn more.

Chargebacks 101: Credit Card Chargebacks Explained
How to Protect Your Business from Non-Fraud Chargebacks
Why You Might Want to Use a Contract for Your Next Transaction

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