A Welsh fintech startup has developed a novel way to combat card-not-present fraud - by migrating offline tap and pin payments to the e-commerce realm.
Developed by Welsh company Burbank, the 'Card-Present over Internet' (CPoI) module enables merchants to securely process card-present transactions in online channels.
“With CPoI, we are aligning in-store and digital payments." says Burbank CEO, Justin Pike. "Our goal is to transform e-commerce by significantly reducing fraud and eliminating false positives — issues that have long plagued online sellers.”
Currently, online merchants face over $40 billion annually in fraud and chargebacks, which is when a cardholder disputes a transaction and the merchant is obligated to provide a refund.
Beyond fraud prevention, Burbank says CPoI addresses an even costlier problem for online businesses: false positives, where legitimate transactions are incorrectly flagged as fraud and declined by banks.
“These erroneous actions cost merchants $443 billion per year, with 65% of blocked transactions being false positives," says Pike. "Worse still, 41% of affected customers never return to the retailer.
With CPoI, online shoppers simply tap their payment card against their mobile device and securely enter their PIN to complete payment, just as they do in-store.
Says Pike: “CPoI will open up internet purchases to all ages and give consumers the highest level of protection when shopping online, whilst revolutionising online commerce for merchants by mitigating fraud, setting a new standard for secure online transactions.”
Pike is a serial entrepreneur and former founder of travel payments company eNett, MyHSM and MYPINPAD.