Connect with us

NEWS

Nets Rolls Out Preventative Fraud Service to Protect Online Consumers Across the Nordics

Nets Rolls Out Preventative Fraud Service to Protect Online Consumers Across the Nordics

Nets blocks clickbait traps and unsolicited recurring payments worth €1.9m, reducing card disputes by up to 20%

Nets, the Nordic digital payments specialist, today announces the roll out of a managed service for banks across the Nordics that aims to protect consumers by preventing potentially fraudulent transactions from occurring online.

The service is designed to mitigate two high growth instances of online fraud: ‘too good to be true’ clickbait offers and unsolicited direct debits, and works by continuously analysing data collected from card disputes to proactively identify and block transaction requests between consumers and fraudulent merchants. Nets applies human verification at every stage of the process to mitigate against ‘false positives’ (where a consumer payment to a legitimate merchant is blocked), in order to protect the end-user’s smooth service experience.

“We estimate that up to 25% of all card disputes raised in the Nordics can be attributed to clickbait offers and fraudulent recurring payments,” comments Judith Thrane, SVP Fraud & Dispute, Nets. “Precise figures are hard to come by, since many occurrences are never reported. Clickbait transactions entice consumers to part with very small amounts which consumers can easily overlook or class as too insignificant to report to their bank or the police. Unsolicited recurring payments operate in a similar way, if the consumer does spot the regular payment many will simply cancel it without raising an official complaint. Our preventative fraud service aims to stop these initiatives in their tracks, saving Nordic consumers time, money and disruption to their digital commerce experience.”

Look out for clickbait offers 

Clickbait offers work by never sending the goods that have been promised, for example, a new iPhone advertised on Facebook for $1. Unsolicited direct debits are set up when a consumer believes that they are making a one-off payment. In this case, the goods are usually shipped, but provisions for a direct debit are hidden in small print in the terms and conditions of purchase. Both these types of fraud fall into a grey area, as the consumer has voluntarily provided their payment details to the merchant.

Immediate effects of service in Norway 

Nets soft-launched the service in Norway in 2016 with 100 clients, including Sparebank1, to investigate whether card disputes would decrease under these conditions. Over 31,000 potentially fraudulent transactions totaling €1,893,433.75 were declined in just four months, and card disputes fell dramatically, by approximately 20%.Thanks to its success the service is being made available from today in Denmark, Finland, and Sweden.

As these merchants are constantly changing their name, acquirer, and other identifiers to avoid detection, Nets analysis is continuous.

“If our service indicates that a merchant is not legitimate, either because it is not delivering paid-for goods or is setting up direct debits without providing clear guidance to the consumer, then any payments to that merchant will be automatically declined, preventing consumers from entering into transactions that, in some cases, they may be liable for,” adds Judith Thrane.

The value-added service is an optional extra offered to Nets’ card services clients as part of its full-service approach to payments, cards and information services.

Judith Thrane commented: “As Nets works with so many banks operating in the Nordics, we have access to more card dispute data than any other provider in the region. This means that we are uniquely positioned to identify potentially fraudulent merchants.  Card issuers also benefit from the preventative nature of our service, as they experience significant reduction in the number of fraud cases, incoming disputes and complaints to customer service – not only reducing their operational costs, but increasing their overall customer satisfaction.”

KristianWoll, System Owner, Card and Payment Products, Sparebank1, added: “Protecting our customers from entering into fraudulent transactions is a priority for us, and this new service from Nets enables us to do that more effectively than ever before. We have experienced great results with fewer disputes and without complaints from customers”.

Continue Reading
Editorial & Advertiser disclosureOur website provides you with information, news, press releases, Opinion and advertorials on various financial products and services. This is not to be considered as financial advice and should be considered only for information purposes. We cannot guarantee the accuracy or applicability of any information provided with respect to your individual or personal circumstances. Please seek Professional advice from a qualified professional before making any financial decisions. We link to various third party websites, affiliate sales networks, and may link to our advertising partners websites. Though we are tied up with various advertising and affiliate networks, this does not affect our analysis or opinion. When you view or click on certain links available on our articles, our partners may compensate us for displaying the content to you, or make a purchase or fill a form. This will not incur any additional charges to you. To make things simpler for you to identity or distinguish sponsored articles or links, you may consider all articles or links hosted on our site as a partner endorsed link.

Recent Posts