It’s the end of the sales month. You’re shy of 1 sale of your quota to hit your next bonus tier. The clock is ticking, and you’ve exhausted every lead in your [digital] Rolodex. Then it happens, like the sun beaming through the clouds after a storm. A hot lead ready to sign up for merchant services! It’s almost too good to be true! After a quick back-and-forth email exchange, they sign the merchant application and provide you with their documentation. Some images are a little fuzzy and hard to read, but it doesn’t matter. This is a level 1 retail merchant; it should be an easy approval. You submit the application, confident you’ve had another approval for the month, and you can finally take that long-awaited summer vacation.
Then it happens, first slowly, then all at once. The account is pended for a mismatched tax ID. The merchant sheepishly explains how odd that would be! It must be because it’s a newly issued tax ID, and their crudely scanned proof of issuance should help clarify the error. Not to worry, you think. Just a minor hiccup. After this, you get another alert. This time it’s for an invalid SSN. Then another alert. A quick Google Street View shows that the address belongs to a longstanding popular quick service restaurant- one that is already processing with this ISO. Finally, the Underwriter informs you that a quick verification phone call with the merchant failed and that the person who signed the paperwork might be a fraud. They will not approve this account, and you have lost the sale.
It’s every salesperson’s nightmare to lose what would have been a surefire deal. In this case, though, the merchant was a fraud and was trying to attain a merchant account to launder money- it would never be a real sale, but a real headache. Fraudsters and scammers are getting more and more clever to try and fool salespeople. Tools like generative AI chatbots, insecure online forms, and convincing-looking counterfeit documents are increasingly prevalent in the merchant services industry. At SignaPay, while any merchant application goes through a rigorous KYC process, it’s a waste of resources for both the processor and sales agent to deal with bogus sales.
As sales partners, you are the first line of defense when identifying bogus leads and bogus merchants. Here are some tips on how you can KYC before getting to the signature stage of a merchant application:
Remember that the level of KYC procedures you apply should be commensurate with the risk associated with the transaction and the customer. Striking the right balance between customer convenience and security is crucial to maintaining a positive sales experience while mitigating potential risks.
The latest industry news, interviews, technologies, and resources
Boosting Your Bottom Line: Strategies for Improving Cost and Expense Control In the fast-paced world of business, keeping a tight grip on costs and expenses is essential for maintaining profitability …
No Fee Payment Processing: Understanding Surcharging, Cash Discounts, and Dual Pricing Credit card transactions offer convenient payment options for consumers but often come with fees that can burden businesses. Fortunately, …
Discover the essential role of PCI compliance in safeguarding sensitive payment information in today’s digital landscape. Learn about the Payment Card Industry Data Security Standard (PCI DSS) and its stringent requirements for protecting cardholder data across online, in-store, and mobile payment channels. Explore the impact of PCI compliance on data security, operational efficiency, and customer trust. Discover how adherence to PCI standards can mitigate financial risks such as regulatory fines and reputational damage, while enhancing long-term business sustainability. Explore more about PCI compliance and secure your business’s future today.