Payer Authentication: This general term incorporates cardholder verification programs such as Verified by Visa®. These programs enjoy broad acceptance in Canada (considerably higher than in the U.S.), deliver greater fraud protection for your customers, and can bring you significant chargeback protection. Because the programs enjoy strong support in Canada, Canadian consumers are accustomed to seeing this step during the checkout process. We strongly recommend you employ these programs as a part of your fraud management toolkit.
Differences in Interpreting Detector Results
IP Inconsistencies can mean Different Things in Canada than they do in the U.S.: Seeing an IP address from a different country than the delivery address on the order can raise a red flag in the U.S.; not necessarily so in Canada. One of the country’s largest Internet service providers frequently resolves to a Chicago-based IP address. Canadian consumers can, in fact, be purchasing from Canada, but display an out-of-country IP address, so a greater tolerance for cross-border ordering is advised to avoid wrongly turning away good orders. That can also be true for orders originating in rural, isolated environments. The common connection strategy in those areas is via satellite. Satellite connections are typically viewed with suspicion south of the border because they are harder to trace (and thus a vehicle used by fraudsters). Denying satellite-based orders from some areas in Canada can mean you are turning away a significant percentage of your likely shoppers.
“Foreign” Cards Aren’t Necessarily So: It is not uncommon for Canadians to use payment cards issued outside of Canada, whether those cards are from France, the
K., or the Caribbean. Wholesale rejection of orders made on foreign-issued cards can seriously impede legitimate business opportunities.
Address Challenges May Cause False Positives: Canada is a prosperous country that happens to occupy a northerly spot on the globe. It is not uncommon for residents to have more than one address—at least one located in a warmer environ- ment. Indiscriminate rejection of cards because the ship-to address is outside of Canada can cause unnecessary loss of online revenue and insults to customers.
E-commerce Fraud in Canada – A-Two Rule Summary
Rule #1: Understand that linguistic and cultural similarities aside, Canada and the
S. are not the same country. Many Canadian payment practices, including address verification, reliance on payer authentication programs, IP addresses, use of foreign-issued cards, etc., are radically different than practices in the U.S. Doing business in Canada and using U.S.-based rules can set your e-commerce sales back significantly.
Rule #2: Learn your way into Canadian e-commerce through pre-production testing. It is important to work with a fraud management system that will allow you to pas- sively analyze the impact of fraud screening rules on sales activity before you impact real orders. Review more than you have done in past environments to learn, all over again, what a good order looks like…then automate.
Visa e-commerce cross-border handbook for U.S. retailers
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