How to Prevent Fraud in E Commerce

Security Measures Against Fraud in Online Shopping

E-commerce platforms, due to the remote nature of transactions, are environments where mutual trust must be established. According to research in Türkiye, there are approximately 500,000 credit card data theft attempts every year—highlighting the increasing importance of preventing fraud in e-commerce. To combat fraud (also known as "sahtecilik" in Turkish), many different methods are used in e-commerce. These measures aim to protect both the customer and the merchant, ensuring secure completion of online transactions. But do you know what secure payment methods are commonly used in e-commerce to prevent fraud in today’s tech-driven world? Here are the top secure payment options used in e-commerce today…

Stay Safe with 3D One-Time Passwords

Fraud in e-commerce can take many forms. One of the most common is when cybercriminals impersonate merchants to access customer card data. With stolen card information, funds can be transferred to untraceable accounts or used for online purchases. In these cases, hackers use valid user credentials to carry out transactions, making it nearly impossible to trace or recover the stolen money. To prevent such fraud, OTP (One-Time Password) technology is used. This single-use code is sent to the customer's registered mobile phone by their financial institution and is valid for only one transaction. Usually, the code remains active for only a few minutes and is used as a security measure. It prevents malicious websites from accessing real banking credentials and ensures that transactions can only proceed with the customer's consent. Thanks to OTP, funds are transferred only with the user’s approval, effectively blocking one of the most common forms of online fraud.

Discover the 3D Secure Payment Method

Among the methods offered by financial institutions to ensure secure online shopping is the 3D Secure payment system. Based on an XML protocol, 3D Secure is a three-dimensional system involving: 1) the financial institution, 2) the card-issuing bank, and 3) an automated system that enables mutual trust between banks. This system works by confirming the identity of the cardholder and validating the authorization process. When a customer attempts to make a payment on a 3D Secure-enabled e-commerce site, they are redirected to a separate 3D Secure page after entering their card details. This page is distinct from the main site, ensuring that any sensitive information entered is not visible to the merchant. The bank then sends a one-time password (OTP) to the customer’s phone, which must be entered within 3 minutes to confirm the transaction. Once the password is entered, the issuing bank sends a secure confirmation to the merchant's bank, completing the transaction. Only the sending and receiving banks can view the OTP, and once used, it has no link to the user's card or account—providing an extra layer of security.

Shop Safely with PCI DSS Compliance

One of the most effective technologies developed to prevent fraud is PCI DSS, which stands for “Payment Card Industry Data Security Standard.” This global standard protects cardholder data and helps prevent information theft. PCI DSS prevents personal and card information from being viewed by third parties or merchants, thereby protecting users from fraud and other financial crimes—such as unauthorized account access, embezzlement, and making illegal payments on behalf of others. If you want to protect your e-commerce site and customers with the highest level of security, you can choose Lidio—a PCI DSS-compliant platform that works with all banks and payment institutions to provide unlimited benefits from a single platform. With the Lidio Core infrastructure and its Fraud Prevention Solutions, you can minimize the risk of fraud. To take advantage of Lidio’s tailored services, contact us today!