NMI
confidence in the payments industry , and we do that by fighting fraud . So , it will always be , unfortunately , a timely topic .”
Understanding the recent changes to liability As well as regulations , reputational risk is also paramount – especially when the emphasis for responsibility is shifting .
So naturally , the big question is : where do the biggest vulnerabilities lie for payment providers ?
“ I think one area where I see a lot of payment providers in a vulnerable situation is in the automation of ongoing risk protection ,” says Cumming .
“ It ’ s a critical vulnerability . For merchant businesses and owners within your portfolio , being able to automate as much of the ongoing risk review as possible is essential . It ’ s very time-consuming work . Another major vulnerability is just a lack of audit capabilities .
“ Making sure you ’ re able to prove that you ’ re doing this enhanced due diligence ; keeping track of the merchants and their ownership structures within your portfolio having that documented ; and having it to back up on for regulators are all critical pieces of the puzzle .”
Talbott also warns that – perhaps unexpectedly – one of the greatest risks to payment providers is a merchant who presents themselves as legitimate , but is actually a welldisguised fraudster .
“ Probably the greatest risk is a merchant who is hell-bent on committing fraud . They know the system , know how to play the game and how it all works . If they are hell-bent on fraud , they ’ re going to work hard to achieve that fraud ,” Talbott explains .
“ We have systems to try and deal with this , but those are the areas that require the most effort and are the most dangerous , because they have already earned trust and a reputation .”
108 May 2023