in Business & Finance

DPO Group provides tips to help Africa’s airline industry guard against fraudulent online payments

Posted 29 October 2019 · Add Comment

Leading African Payment Service Provider DPO Group, which operates across 18 African countries, has analysed 10 years of its airline merchant payment transaction data to reveal soaring demand for online payment solutions whilst highlighting where most fraud and risk originates from.

 

The number of digital payments made by airlines on DPO’s platform increased by more than 56% between 2017 and 2018 alone. According to the data, most attempts at fraudulent payments for flights in and out of Africa originate from North America and Eastern Europe. This belies the often-held view that most attempts at fraud originate from within African countries. The top 10 origin countries of fraudulent attempts across airline digital payments between 2009 and 2018 were global in nature: with the United States topping the list, followed by Canada, South Africa and Eastern European countries.

Eran Feinstein, CEO of DPO Group said: “The airline industry is unique in terms of online payment risk. DPO began as an airline payments solution in Africa 13 years ago, so we understand the challenges facing the industry better than anyone. As airlines push to increase direct and mobile bookings, there is a need to be increasingly vigilant and on guard against sophisticated attempts at fraud. Globally, airlines lose up to 2% of revenue as a result of payment related fraud but thanks to our multi-dimensional approach to fraud and risk management, for airlines working with us the percentage is significantly lower at less than 0.2%. This makes us the safest online payments solution for airlines in the world.”

DPO Group outlines its five top tips for airlines to reduce fraud and manage risk:

Work with a payment service provider that employs real-time monitoring systems; this ensures that fraudulent activity is caught immediately. Expert fraud and risk teams can then screen payment transactions for suspicious activity and take action within seconds.

Employ a ‘Negative-List’ system to automatically reject suspicious transactions from customers with a known fraudulent history.

Ensure that you have a robust check-in procedure in place for card payments and gather additional information on suspicious bookings. For example, fraudsters often avoid providing valid contact details. If you are unsure about a booking, ask the customer to send a copy of their identification.

Carry out regular staff training to ensure your team are well equipped to carry out check-in procedures and to identify any fraudulent activity during flight booking and check-in processes.

Make sure your refund policy is clearly communicated to your customers to avoid unnecessary disputes and card payment chargebacks.

The ability to manage disputes and chargebacks (when a consumer requests their funds to be returned) and a lack of internal resources to combat fraudulent payments remain key concerns for the airline industry as revealed in the CyberSource Report.

Feinstein added: “Our chargeback rates for airline merchants at 0.12% annually are far below the industry accepted rate of around 1% to 2%. We know that airlines are struggling with time and resources to manage disputed online payments, so we have built this into our fraud and risk management processes, taking on the burden of checking out each transaction or individual when our dashboard system detects an anomaly and finding the resolution. This saves the airline time and money, while reducing their overall rates of fraud and risk.”

Eran Feinstein, CEO of DPO Group

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