Introduction
Mexico’s rapid growth in digital payments has created a paradox: while electronic transactions facilitate consumption, they also multiply the risks of fraud for consumers, merchants, and businesses. This ease has been exploited by specialized criminal networks operating on payment infrastructure, warns Bernardo Prum, General Manager of Toku México, a payments firm.
Fraud Across the Board
No profile is immune to fraud in electronic transactions. One common modality is the theft of information through digital deception targeting users. Merchants face an equally complex scenario, with schemes involving stolen cards, assumed identities, or illicitly obtained financial data.
Robust Anti-Fraud Measures
Prum emphasizes the importance of having robust anti-fraud engines in payment gateways and tools like 3D Secure, which enable a series of validations to confirm the payer’s identity and card ownership.
Structural Challenge in Online Payment Acceptance
Mexico faces a structural problem with online payment acceptance. Fear of fraud has led to overly strict verification systems, directly impacting transaction approval rates.
- Current digital payment acceptance is around 80%.
- This implies that one in five legitimate transactions may fail.
The payment orchestration aims to raise this percentage without increasing risk exposure.
Delicate Balance in Payment Operations
Payment platforms operate on a delicate balance: preventing fraudulent operations without affecting legitimate users. They incorporate various verification layers, from basic validations to advanced behavior analysis models.
- Mechanisms include CVV, SMS authorizations, and reinforced authentication systems.
- User consumption patterns are also analyzed.
The challenge lies in achieving controls and alerts that are transparent to users without affecting 99.9% of non-fraudulent individuals.
High-Risk Seasons
During high-consumption periods like El Buen Fin, Christmas, or Mother’s Day, there are spikes in risk, both in transactions and fraudulent attempts. This combination increases the likelihood of incorrect rejections, operational delays, and losses for businesses and consumers.
In response, there’s a shift towards more complex payment management schemes, emphasizing avoiding single-channel dependency and strengthening security standards.
Key Questions and Answers
- What is the main issue Mexico faces with digital payments? Mexico struggles with overly strict fraud verification systems, negatively impacting legitimate transaction approval rates.
- What types of fraud are common in Mexico’s digital payments? Common fraud includes stolen card information, assumed identities, and illicitly obtained financial data.
- How do payment platforms balance fraud prevention and user experience? They use various verification layers, from basic checks to advanced behavior analysis models, ensuring transparency for users while minimizing false rejections.
- What challenges arise during high-consumption periods? There’s an increased risk of incorrect transaction rejections, operational delays, and losses for businesses and consumers.
- How are payment systems evolving to address these challenges? There’s a shift towards more complex payment management schemes, focusing on multi-channel approaches and enhanced security standards.
