Are small and medium-sized businesses (SMBs) losing opportunities by being overly cautious? To be sure, SMB fraud losses are rampant in today's increasingly digital age, but many are also missing out on potential growth by not adopting modern tools. Keep reading to learn more.
Shifting Consumer Preferences
Most transactions now happen online because people crave speed and convenience. With just a few clicks, you can shop, pay bills, or book services.
Direct bank transfers were once the norm for these transactions, but digital wallets and contactless payments are taking over. According to a Tink study, two in five (41%) consumers now admit to walking away when requested to make a manual transfer, while nearly three in five (57%) distrust establishments that request payments through this method.
Why the sudden change in attitude? Customers also have a fear of fraud, and this concern only grows when the account name provided doesn't match the business name.
Why Are SMBs Avoiding the Transition?
SMBs have yet to make the necessary payment system upgrades for the following reasons:
A Higher Potential for Fraud
A 2018 TechRadar analysis shows that cybercriminals have long exploited modern payment methods to target smaller companies, so many of them feel stuck between a rock and a hard place. Do you make these changes to hopefully attract more consumers or stick to traditional methods with a lower risk of fraud losses?
Limited Resources for Protection
Established corporations already leverage robust cybersecurity infrastructure and have the resources to fine-tune it as needed. SMBs, however, often face tighter budgets and may struggle to prioritize cybersecurity alongside growth efforts.
Steep Learning Curves
Adopting new technology isn't always as easy as it sounds, and many payment platforms require the following:
- Training employees on platform usage
- Integrating the system with existing tools
- Checking compatibility with current processes
- Understanding compliance and regulatory requirements
- Addressing potential technical glitches during adoption
- Allocating resources for ongoing maintenance and updates
Without the in-house expertise or time to spare, SMBs may worry about improper implementation or costly mistakes.
Building Customer Trust Through Accessible Fraud Prevention
You don't necessarily have to overcomplicate fraud prevention to gain a wider client base. Start by implementing these simple security measures:
Partner With the Right Payment Providers
Many vendors offer fraud guarantees that reimburse losses from unauthorized transactions. They work by monitoring payments for suspicious activity and resolving disputes quickly, so both you and your customers can feel safe and supported.
Integrate Multi-Factor Authentication Into Digital Transactions
As the name suggests, multi-factor authentication (MFA) adds a layer of protection to transactions through multiple verification steps, such as one-time codes sent to the user's device or biometric scans.
When threat actors manage to steal login details, they would also have to bypass these requirements to make a transaction.
Empower Your SMB With Smarter, Safer Solutions
SMB fraud losses and cybersecurity risks are a legitimate concern, but the growing demand for multiple payment options isn't going anywhere. Businesses have to adapt quickly or face considerable revenue loss.
Invest in affordable security measures, take proactive steps to educate your team, and regularly evaluate the popularity of your existing systems.
