IoT (Internet of Things) can worsen or reduce online payment fraud for both merchants and customers alike. As a merchant, you should keep in mind the points below. These tips will prepare you for good and bad changes that may be caused by the more widespread adoption of IoT around the world.

  • What is IoT?

IoT is where computers, mobile devices, wearables, appliances, business tools, manufacturing equipment and transportation facilities are equipped with technologies that use the Internet and big data. This means IoT technology can be used to perpetuate online payment fraud if security protocols aren’t implemented properly.

The widespread adoption of this technology worldwide also means more data for criminal syndicates to harvest. Cloud servers are used to store big data. These are accessed by IoT gadgets and equipment. If effective security protocols are not integrated into these cloud systems, then criminal syndicates can hack into these databases and steal data. They can then use these stolen details to perpetuate online payment fraud and other Web scams against merchants and customers alike.

  • How IoT Can Help Fight Online Payment Fraud

Hardware tools and equipment can be integrated with security protocols. These can be harder to circumvent. These include fingerprint scanning engines and voice or facial recognition tools among others. More effective security measures can help fight online payment fraud, for the benefit of both merchants and their customers.

The distribution of encrypted data bits across multiple cloud servers can make it harder for criminal syndicates to access complete data streams. They need to take down or hack into entire cloud server systems before they can steal useable data. This is now used in bitcoin mining and transactions, which has made it very difficult for criminal syndicates to access usable data.

More effective data transmissions from customers to merchants and vice-versa can mitigate risks of chargebacks and disputes for merchants. This can also reduce online payment fraud for customers. For example, real time fingerprint scanning tools along with live voice and facial recognition processes for customers can be conveniently performed by customers during an online transaction. This makes it more difficult for criminals to use stolen data.

When hardware manufacturers begin to implement these technologies into their IoT products, merchants can benefit from efficient APIs that use these security protocols. Customers can on the other hand feel more confident to transact on the Web with the adoption of these security protocols and technologies. Third party developers can even create and distribute these security appliances for these IoT gadgets and equipment. So, aside from providing cost-effective options to fight online payment fraud, this can also build new industries.

Do you have ideas on how IoT and big data can worsen or reduce online payment fraud? Leave your thoughts on Share this with your friends and colleagues, so we can all contribute to generating ideas that can best fight Web payment fraud and online crimes like credit card theft, Internet scams and malware or hacker attacks.