As e-commerce grows, payment security and fraud prevention have become indispensable. Here are 20 essential terms in the world of payment security.
1. PCI DSS (Payment Card Industry Data Security Standard)
A global security standard defined by card networks for data security in credit card transactions. Mandatory for every business that processes card data.
2. CVV (Card Verification Value)
The 3- or 4-digit security code on a credit card. Proves the cardholder physically possesses the card during online transactions.
3. SSL (Secure Socket Layer)
A security protocol that encrypts data between the user's browser and the website.
4. 3D Secure (Three-Domain Secure)
Adds an extra authentication step to online card transactions via a one-time code sent to the cardholder.
5. Tokenization
Replaces sensitive data with a unique token, reducing the risk of data breaches.
6. Encryption
Converts sensitive information into a secure code that cannot be read if intercepted.
7. Phishing
A fraud type where attackers impersonate a trusted organization to steal sensitive information.
8. Fraud Detection Algorithms
Monitor transaction patterns and automatically flag suspicious activity.
9. Chargeback Protection
Reduces a business's financial losses when customers unjustly dispute a transaction.
10. Secure Payment Gateway
Technology that connects a merchant's site to the payment processor and handles transaction data securely.
11. KYC (Know Your Customer)
A process requiring businesses to verify customer identities to prevent fraud and money laundering.
12. AML (Anti-Money Laundering)
Policies developed to detect and prevent illegal financial activities.
13. OTP (One-Time Password)
A randomly generated password valid for a single use, sent for identity verification.
14. Behavioral Analytics
Uses AI to monitor user behavior and detect anomalies.
15. Biometric Authentication
Verifies user identity using fingerprints, face recognition, or iris scans.
16. Friendly Fraud
Occurs when the legitimate cardholder unjustly disputes a valid transaction.
17. MFA (Multi-Factor Authentication)
Requires two or more verification methods to confirm identity.
18. IP Geolocation
Determines the physical location of an IP address to detect unusual transactions.
19. Card Skimming
Theft of card data using a device placed on ATMs or card readers.
20. Fraud Risk Scoring
Determines the likelihood of fraud for a transaction and flags high-risk ones.