How to Avoid Credit Card Fraud in the Tourism Industry

The tourism industry is a popular target for credit card fraud, according to a leading payment services provider – but there are ways to manage the risk.

“Accommodation establishments like hotels, guesthouses and B&Bs are especially vulnerable when it comes to last-minute bookings,” says PayGate head of business development Brendon Williamson. “Online booking services usually close at least 12 hours ahead, so when someone discovers at lunchtime that they need a room for that same night, the establishment has to take their credit card details over the phone or by email and process the payment manually. That means they lose out on all the fraud checks that are built in to an online checkout process.”

“Of course most last-minute bookings are legitimate, and accommodation establishments have to put their customers first,” adds Williamson. “But fraudsters know how the system works so this is a popular tactic for them – and they’re often very charming individuals. They check in with a false ID and a stolen premium credit card, enjoy VIP hospitality and leave in the morning with nobody any the wiser. They can also be very convincing in getting the establishment to accept a third party payment on their behalf. The establishment might only find out they’ve been defrauded months later, when they get a chargeback notification from their bank because the real owner of the credit card has complained.”

Williamson says PayGate’s enhanced PayBill service allows businesses to accept credit card payments outside of their online booking portal, but with all the security checks still in place. “Whoever is taking the booking can easily create a bill and email it to the customer via our Merchant Portal. A secure payment link is included so the customer can click and pay instantly via a secure payment gateway. It’s so quick it can all be done during a single phone call.”

The system provides peace of mind for customers as well as for businesses, says Williamson. “Many customers aren’t willing to give their credit card details over the phone, because they know it could create an opportunity for someone to clone their card This way the establishment front desk never needs to know the card details until the customer actually checks in — and the card is always in the presence of the cardholder.”

For the business, the entire payment process is all managed securely by PayGate, says Williamson. All transactions are tracked so the business owner can easily check how many bills have been issued and which customers have paid – and send personalised reminders at the click of a button.”

Williamson says PayBill is especially powerful when used together with a fraud protection system like PayGate’s PayProtector. “The establishment can be confident that the card has been checked against lists of known stolen cards as well as a number of other security checks. This reduces their chargeback risk and ensures that there is a detailed audit trail.”

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