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Best Practices: Protect Your Shop and Mitigate Risk When Accepting Card Payments
Best Practices: Protect Your Shop and Mitigate Risk When Accepting Card Payments

Navigate best practices to protect your shop and mitigate risk associated with accepting card payments

Anya Iskandarian avatar
Written by Anya Iskandarian
Updated over a week ago

Implementing best practices, such as obtaining relevant details at the time of sale, capturing signatures, and clearly communicating shop policies will mitigate the risk associated with accepting card payments. Learning about the risks associated with accepting card payments and how to identify suspicious transactions will further protect your business.

Best Practices to Mitigate Risk

Making small changes to your shop processes can greatly reduce the risk of fraud and lower disputes. The key is to stay consistent with the changes you implement.

Capture Relevant Details

Capture all relevant details for the invoice at the time of creating the order. These pieces of information are needed when (fighting) responding to a dispute, if the information is missing or incorrect it may weaken your dispute rebuttal.

  • Name of the cardholder (full name as it appears on the card)

  • Billing address

  • Shipping address (if applicable)

  • Phone number

  • Email address

Maintain Visible Business Information

Ensure your business name is consistent on all materials. The statement descriptor (the name that appears on the customer’s card statement) should match the business name on your invoice. Customers are more likely to initiate a dispute when they see an unfamiliar business name on their statement.

Ensure your contact information is highly visible on all materials. When business contact information is easily visible on your invoices, estimates, and receipts, customers are more likely to reach out to you directly, rather than filing a dispute with their bank, if they have any questions regarding unclear charges.

Communicate with Customers

Establish an open line of communication with your clients. Promptly follow up on inquiries. If there are delays or changes to the agreed-upon terms, communicate these promptly and offer a refund if the cardholder does not want to wait. When following up or advising of delays, it's important that this is documented in messages. So if it is questioned down the road you have PROOF that it was communicated.

Don't hesitate to ask for the cardholder’s ID. If a client cannot provide an ID to match the physical card used for payment, you can ask for a different form of payment or ask them to return with their ID. This is especially important for large orders and first-time customers. If a transaction is disputed, the bank will want to know what measures you took to verify the customer. For PCI compliance, it's important that you do not store full card numbers, you should always truncate them (block out the card number in the middle, so that only the first four and the last four are visible).

If a fraudster uses a debit/credit card to purchase a product/service from your business, the real owner of the card can dispute the transaction(s).

Have a clear refund policy. All of your customers should be made aware of your refund policy and the parameters around the refund policy before completing the payment transaction. It’s best to have your refund policy on the invoice and receipt near the cardholder’s signature area. When responding to disputes, a signed refund policy or terms of service is considered strong compelling evidence. If the policy is “no refunds”, you must prove that the customer was aware and acknowledged /agreed to the terms.

A detailed description of refund-request parameters should include:

  • The time frame a customer has for requesting a refund

  • How a refund may be requested

  • The circumstances under which a refund will be considered

  • The circumstances under which a refund will NOT be considered (special / custom orders)

Having a refund policy in place does not guarantee avoidance of a dispute. A refund policy with detailed parameters and limitations carries more weight than a flat ‘NO REFUNDS’ policy.

Have customers acknowledge and accept your terms of service. Clear terms of service include refunds, anticipated timelines, costs, etc. Establishing these is especially important for large and ongoing jobs. Established terms of service are considered compelling evidence if the transaction results in a dispute.

Document Shop Activity

Utilize the Shopmonkey Message Center. Maximize this feature by documenting all communications and authorizations between you and the cardholder, including tracking numbers if a product was shipped. This will serve as customer communication in the event there is a dispute. Gathering compelling evidence quickly will be easier when all communication and documentation are housed in one place. Avoid having to take screenshots of text messages on the phone or social media.

Utilize Shopmonkey Inspections. Capture photos and notes of the before and after of servicing vehicles. This is especially important compelling evidence when a cardholder is claiming "services not as described" or "services not rendered".

Obtain signatures. A signature serves as validation, authorization, acknowledgment, and confirmation when obtained on invoices, receipts, deliveries and pickups, vehicle inspections, progress payments, etc.

Add a layer of protection by utilizing Shopmonkey E-signatures. This provides the ability to capture signatures, rather than just authorization, from the cardholder. The E-Signatures feature is available for Clever (for a monthly fee) and included for Genius subscriptions and above.

If a customer makes multiple transactions, including progress payments or installment payments, obtain a signature for each transaction. Obtaining signatures for multiple transactions will protect you if it is later disputed as unauthorized or duplicate charges.

Shipping & Delivery Best Practices

Verify that the shipping address and billing address match. A difference in address by itself doesn’t indicate fraud (e.g. the customer might have purchased a gift). However, the discrepancy is an indicator that the charge should be looked at more carefully.

  • Consider instituting a 24-48 hour shipping delay for high-value orders or shipments to non-verified addresses or first-time customers.

  • Take caution of customers who request overnight shipping, as this service is of no consequence to fraudsters.

Retain shipping and tracking information. Provide customers with their tracking number when the item(s) shipped, so they may track their package. Require a signature at delivery. A signature on the proof of delivery confirms the customer received the product.

Avoid Fraud

Shopmonkey diligently works to identify and notify you of any unusual activity or fraud, but you are the first line of defense. You are responsible for all transactions you put through Shopmonkey Payments. These responsibilities include:

  • Verifying end customers’ identities

  • Obtaining appropriate consent to submit charges through Shopmonkey Payments on an end customer’s behalf

  • Determining the end customer’s eligibility and authority to complete transactions

You should make every effort to properly vet your customers. A fraudster will not hold back when they spot a vulnerable business. A fraudster will hit hard and quickly with as many orders until the true cardholder notices the unusual activity and disputes the transactions. Be aware of suspicious requests and trust your gut. Download our QuickGuidetoFraud.pdf document for tips on spotting and preventing credit card fraud and scams.

When a card payment is taken, the business (you) and the customer (cardholder) enter into an agreement. You, as the business taking payment for a service/product, are held liable if the customer initiates a dispute or requests a refund. Disputes are an assumed risk you take when accepting card payments.

Early Fraud Warnings

You may receive an Early Fraud Warning notice from Shopmonkey. These are notices that card issuers generate to flag a payment that they suspect to be fraudulent. This is created when a cardholder lodges a claim of fraud with their issuing bank before an official dispute. Early fraud warnings become disputes 80% of the time. The refunding window is open 24-48 hours after the notification. Issuing refunds will prevent a dispute.

  • If services are already rendered or products delivered, we highly recommend you gather all documentation for the transaction, in preparation if a dispute arises.

  • If services are not rendered or the product is not yet shipped, we recommend that you do not render services or ship the product until you fully verify the customer.

  • If there are other outstanding invoices, we highly recommend that you properly vet your customer.

Suspicious Transactions

Refund suspicious payments promptly. If you suspect fraud or are uneasy about a recent transaction, it’s best to refund promptly or request certified funds (Cash, Venmo, etc.) to avoid a dispute.

Spotting Suspicious Transactions

The customer refuses to verify their identity. Fraudulent customers will push back on providing details to confirm their identity or create escalations as a way to move focus off verifying their identity.

The customer communicates strictly by phone, email, or text. Potential fraudsters avoid in-person contact and may authorize a different person to pick up the item. The individual may explain their absence by claiming to be in the hospital, having a disability, or being too busy.

Please keep in mind that phone calls/emails do not confirm that the person on the other end is the true cardholder. This approach is often used by fraudsters for two reasons:

  • To hide their true identity

  • Gain sympathy in hopes that you’ll be more willing not to ask many questions

The customer has unusual card activity. Pause and be on alert if you have a customer who displays one or more of these indicators during the time of payment.

  • Excessive declines: Declines can arise when exceeding the limit, having insufficient funds, the card is not authorized, etc.

  • Request for split payments: Be on alert if a customer asks to split a payment into 2 or more installments, especially if using different cards. It is unlikely that one customer will pay for goods/services with 4+ cards.

  • Multiple cards are given: When a customer asks you to split a transaction into various amounts, this may be a fraudster attempting not to exceed individual card limits.

  • Cards have similar account numbers: This could indicate that the account numbers used may have been generated using a software program. It is highly unlikely that a legitimate customer has multiple accounts with similar numbers.

The shipping address and billing address are different. This could be an indicator that a fraudster is using a stolen card and shipping to an address where they can easily obtain the goods. A difference in address by itself doesn’t indicate fraud, but the charge should be looked at more carefully.

The customer asks you to wire or money transfer a portion of the sale. You may be asked to use part of a card transaction to pay a 3rd party, a special vendor, or a shipping company. The request will instruct you to make a money transfer such as a wire, Western Union, money order/cashier’s check, bank transfer, or via peer-to-peer app (Venmo, CashApp, Zelle). You should never need to send your customer funds back from a charge on a card.

The customer cancels the order but wants a refund via a different method. They will typically ask for a refund via cash, cashier's check, or wire transfer. This is highly suspicious because the original card charge can be disputed. You would have no proof that a refund was given because the bank cannot verify a refund if it’s on the same card as the original charge.

The customer has out-of-the-norm order requests. These types of requests are typically done by first-time customers. Unusual order requests include:

  • Bulk orders or frequent orders in a short period of time, and usually for goods that have high resale value (tires, rims, kits, etc.). Stolen cards have a limited life span, so fraudsters need to maximize the size of their purchases within a short period of time.

    • You have a right to ask additional questions to the customer attempting to make a large purchase. If the customer is legitimate, they will appreciate the due diligence. If they are fraudulent, they will likely argue or threaten to take their business elsewhere.

  • Requests for overnight shipping or expedited service. This could be an indicator that the fraudster is in a rush to complete the transaction before the card is reported to the issuing bank.

    • The increased cost of expedited shipping is of no consequence to fraudsters. It’s less likely that a legitimate customer would pay such high shipping costs.

  • Orders that include several varieties of the same item. Having multiples of the same item increases the fraudster's profits.


Fraud is a changing landscape. While the signs listed above are often associated with fraud, they do not necessarily mean your customer is a fraudster. If you highly suspect fraud or want to deter the transaction, you can let the customer know you can’t accept the sale via card but can take cash, money order, or cashier's check. Refund suspicious transactions immediately to help you avoid a dispute and keep your dispute rate under 1%. A dispute rate over 1% is considered excessive and will be visible to card networks.

Head back to Best Practices: Accepting Card Payments for more information.

We recommend that you read through all three linked articles as they will help you better understand card payments through Shopmonkey Payments.

We are here to help! Feel free to reach out to the Risk Department at and the Dispute Team at

We provide integrated payments - we do not provide business advice or legal advice.

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