Are you one of the 15 million to 20 million people the FTC estimates are crammed each year? Cramming is when a company adds unauthorized or deceptive charges to a consumer’s phone bill. One of the reasons cramming is so common is that the amounts charged are often small, usually only a few dollars. As a result, many consumers don’t notice they’re paying extra for a product or service they didn’t order. So how can you stop cramming?

• Do review your phone bill every month. Yes, you’re busy—but one of the best ways to stop cramming is to review every phone bill. Look for charges you haven’t authorized, even if they sound legitimate. If you have ordered a new service, check the bill to make sure you’re being charged for what you ordered—and not more.
• Don’t cash checks without reading the fine print. Crammers sometimes send checks in small amounts—often a few dollars—to unsuspecting consumers. But by cashing the check, you agree to purchase a product or subscribe to a service that, chances are, you don’t want.
• Do consider a third-party billing block. A billing block prevents companies from charging your phone bill unless you contact the phone company first to authorize the charge. Contact your local phone company to learn how to place a third-party billing block on your line.
• Do contact the merchant or phone billing service when you find a suspicious charge.  As soon as you notice an unauthorized transaction, contact the company listed on the line item. Remember, even if you dispute a charge, you’re still required to pay the rest of the phone bill on time.

As a third-party payment processor, ILD Teleservices works closely with its partner merchants to ensure accurate billing.  We screen merchants before we work with them, monitor them to make sure they comply with good business practices, and require them to verify authorization of billing. Learn more about the ILD Consumer Protection Standards of Practice.

If you have questions about a bill, please visit our Help Center.

Image: renjith krishnan / FreeDigitalPhotos.net

What is phone billing? If you’re shopping on a website that sells digital services, such as gaming or downloads, you may see an option to charge the purchase to your telephone bill. But is this a safe way to pay online? How does phone billing work? Is it the same as cramming?

Here is a consumer FAQ guide to shopping smartly and safely with phone billing:

What is phone billing?

Phone billing allows online shoppers to buy ecommerce services and charge the transaction to a telephone bill. It’s not a credit card transaction, so you pay no interest or other fees that big banks tack onto credit card sales. When the transaction shows up on your phone bill, you simply pay it along with the rest of the bill, using whatever payment method you normally use, such as a check or money order. The entire transaction is handled by a third party payment processor, like ILD Teleservices.

But is this a safe way to shop online?

Absolutely! When you charge a purchase to a phone bill there are no credit card or bank account numbers to share over an Internet connection—and that significantly reduces your risk of identity theft. You’re not asked to provide any sensitive financial information; you’ll simply give your phone number as well as information to verify your identity.

Will I become the victim of cramming if I pay for digital goods through phone billing?

Cramming is when a consumer is subject to unauthorized charges on a phone bill. A reputable payment processor works very hard to ensure that customers are billed only for the goods and services they have ordered. At ILD, we take proactive steps to protect consumers from cramming. For instance, before we agree to handle phone billing for a merchant, we conduct a rigorous screening process to ensure that company maintains appropriate business practices.

If you ever have a question about an ILD charge that appears on your phone bill, we welcome you to contact our help center.

Is the cardholder legitimate? Is the credit card valid? For years, these types of questions have dogged the digital merchants who rely on card-not-present transactions to do business. And while credit card sales aren’t likely to disappear in the near future, there are strategies merchants can implement to manage the risk of fraud. Here are four to consider:

1. Invest in the right third party payment processor. A payment partner should be more than the “system that handles the money.” The right processor will understand the risks of operating in the digital space as well as provide the tools and expertise to reduce fraud exposure. For example, ILD’s Bill to Phone, which charges transactions to the customer’s phone bill, offers a real-time verification system that validates the customer’s identity.
2. Develop risk management procedures. Implement the internal controls that lower your brand’s risk of losing revenue to cybercriminals and “friendly” fraud transactions. Review everything from the sales order process to real-time customer identity verification.
3. Educate staff. Those risk management procedures won’t be worth much if employees aren’t familiar with them. Teach staff about your company’s fraud prevention tools and strategies. New and established employees should also understand how to follow the risk management procedures you’ve implemented.
4. Review risk management plans on a regular basis. Fraud reduction and prevention is not the work of a single day or week. Criminals find new ways to steal from businesses. Payment processors develop new fraud prevention strategies. To maximize return on a risk management plan, regularly review the strategies and tactics.

ILD Teleservices is a trusted third party payment processor for a range of industries, from telecommunications and ISP to gaming and home security. Our Bill to Phone alternative payment method allows you to build predictable revenue streams while reducing your exposure to fraud. To learn more about our ecommerce payment solution and real-time customer identity verification, contact our team.

Whether you’re the director of a non-profit or a business professional serving on a board, you know how challenging it’s become to fund the mission. With the funding well drying up, organizations are more and more reliant on building strong support from the public. One strategy to make it easier for donors to give is to add an online giving alternative payment option, such as phone billing, which charges the donation to the supporter’s phone bill. Here’s how it works to boost online donations:

1. Convenience. Donors have big hearts and busy lives. A non-credit card payment method is a low-hassle option because there are no credit card numbers or security codes to enter, making it easier to give on the fly.
2. Safety. No matter how passionate a supporter might be about your cause, the threat of identity theft may make them think twice about sharing their credit card or bank account information over an Internet connection. Phone billing doesn’t require donors to share any sensitive info online, giving the supporter peace of mind.
3. Value. Charging a donation to a credit card increases the cost of the transaction to the giver; after all, they’ll likely pay interest and potentially other fees. Adding an alternative payment method eliminates those costs, which may just translate into a bigger donation for you.
4. Choice. Credit card payment options are fine and dandy—as long as the supporter has a credit card. In fact, nearly 30% of households in one 2010 study reported they didn’t have a credit card. Don’t turn away donors simply because they don’t have plastic. With phone billing, the giver needs a home or business phone number. That’s it. The option opens up whole new markets to help support your cause.

Whether your group mentors kids, funds scholarships, or provides job opportunities for veterans, adding an online giving alternative payment method, like phone billing, makes it as easy as possible for you to get the support you need.

ILD Teleservices is an experienced third-party payment processor with a phone billing platform that’s easy for you to integrate and easy for supporters to use. Learn more about how to increase online donations using our Bill to Phone service.

We encourage consumers to review their bills each month, from credit cards to utilities and phone bills. So, we are re-running a blog post from last year, where we provided some best practices we’ve picked up along the way.  Here it is:

In this economy, every penny counts—and that makes it especially frustrating to discover a charge you didn’t authorize on your phone bill. The good news is you can reduce the risk of becoming a cramming victim. Here’s a guide to help you prevent those unauthorized telephone charges.

Cramming hurts consumers.

Cramming occurs when your telephone bill is charged with services that weren’t ordered by you or anyone else in your household. Unauthorized charges range in monetary amounts, but can be as little as a few dollars. If they go undetected, they add up over time, putting a ding in your wallet. The charges can be for a variety of services, such as web hosting, club fees, or phone calls.

Protect yourself from cramming.

The Federal Trade Commission (FTC) recommends these steps for reducing your risk of cramming:

• Review each line of your phone bill every month.
• Read the fine print before providing your phone number and other information to enter contests and other promotions. Fraudsters may use your entry form as an authorization to enroll you into a service so they can bill the charges to your phone account.
• Be wary of signing up for a “free” club or service or of claiming a “free” prize; you may be inadvertently signing up for a fee service that’s charged to your telephone bill.
• Contact your phone company to ask about the blocking options they offer. A block will prevent a certain type of service on your phone line. For example, a third-party service block stops any third-party payment processors from billing your account.

ILD protects consumers from cramming.

ILD Teleservices is a third party payment processor. Merchants use our Bill to Phone service to allow consumers to charge purchases directly to their phone bill. As a result, consumers do not need to share sensitive financial information, like credit card numbers or bank account numbers, reducing your risk of identity and credit card fraud.

We are committed to protecting consumers from unauthorized charges. For example, ILD only works with merchants after the vendor successfully passes a screening process that includes extensive background checks and a business plan review. After we take on a merchant, we continue to monitor their activities and customer satisfaction levels.  If ILD receives excessive complaints about a merchant, we take immediate action to rectify the problem or, if necessary, terminate our business relationship with the company.

Call us if you have questions.

ILD’s U.S. based customer service team is available Monday through Friday from 7 a.m. to 8:30 p.m. (CST) and Saturday from 9 a.m. to 5:30 p.m. One of our associates will answer your questions or help find a resolution.

Friendly fraud. Despite its name, there’s nothing friendly about a reversed transaction that costs a digital merchant time and money.  Friendly fraud is when a consumer makes an ecommerce purchase, receives the goods or services then initiates a chargeback. But there are tactics that help ecommerce merchants reduce the rate of friendly fraud.

Learning how to reduce chargebacks from friendly fraud starts with asking yourself these 3 questions:

Will the customer recognize my company on their billing statements? When a consumer reviews a billing statement, whether it’s for a credit card or a phone bill, they may be suspicious of an unfamiliar or ambiguous name, even if they’ve already received the product or service. Always ensure the name that appears on the bill will be identifiable to the customer. If you partner with a third party payment processor, post an easy-to-see note on your website that notifies customers that the processor’s name (for example, “ILD Teleservices”) will appear on the billing statement.

1. Can the customer find my ecommerce store’s contact info easily? Customers who are already frustrated may not have the patience to hunt for the small-print 800 number buried at the bottom of the web page. Make contact info prominent so the customer will be more likely to contact you first, instead of the bank or card issuer. Remember to list your customer service hours as well.
2. Is my digital store’s return policy ecommerce friendly? A liberal return policy not only attracts prospects who may be wary of shopping online, it also makes customers more likely to return a product or cancel a service instead of initiating a chargeback.

Disputes are going to happen. But by implementing simple ecommerce best practices, such as identifying your third party payment processor or making returns easy, you will start reducing chargebacks from friendly fraud—and start controlling your costs.

Do you have tips for how to reduce chargebacks from friendly fraud?

Ecommerce isn’t a fix-it-and-forget-it endeavor. If you want to generate revenue, digital commerce needs to be a continuing process that analyzes and refines the tools you use to make transactions happen. A good place to start on any site is the shopping cart. Are you making one of these ecommerce shopping cart mistakes?

You play hide-and-seek with navigation buttons.

Basic navigation buttons should be simple to find, especially if you expect to make the shopping experience hassle free. If a consumer needs to hunt for a search box, for example, they may just become frustrated enough to click onto a competitor’s site. Shoppers should be able to easily find buttons, such as:  

• Buy
• Cancel
• Change quantities
• Shipping charges/estimates
• Search box
• On sale/bargain products
• Top sellers

The pages are a jumbled mess or a utilitarian wasteland.

Ecommerce pages need to blend appealing images with functionality. If the digital store’s page is cluttered with too many photos or images that are too large, they eat up real estate needed for some of those navigation buttons that make online shopping a breeze.

But you also can’t expect to appeal to consumers with a shopping cart that looks like a dot-matrix printout from 1990. You still need appealing, professional-level images to help sell a product, whether it’s a cat toy or a corporate report. Use the best-quality images possible rather than “no image available” icons.

You don’t build trust with ecommerce customers.

As consumers become increasingly aware of the potential risks of identity theft, it’s critical to instill trust. Share contact information, such as email address, phone number, or live chat info, clearly and prominently to alleviate consumers’ concerns.

Another way to build trust is to partner with a third-party payment processor that offers credit-card free payment options, like phone billing, so the shopper doesn’t need to share sensitive info to get the goods and services they need.

What other no-no’s have you seen in ecommerce shopping carts?

As an ecommerce merchant, you know that customers want—and need—alternatives to the traditional credit card payment option. So if you want their business, you need to partner with an alternative payment processor who offers the right blend of expertise and easy-to-integrate technology. But before you sign on the dotted line, here are a few questions to ask the third party payment processor:

1. What is the deposit process? Cash flow is the lifeblood of any business—so be sure to understand how long it will take to deposit money into your account. Also find out if there are any situations that would delay a deposit.
2. Will a member of the payment processing team explain the statement to you? As a business owner, you deserve to know exactly where your dollars and cents are going. Be sure the prospective alternative payment partner is willing to familiarize you with how to read and understand statements.
3. If you dispute a fee, how will it be handled? If you see a fee that doesn’t look right, it’s important to know how the payment processor deals with merchant disputes. Find out what the dispute process entails as well as who makes the final verdict regarding refunds or waived fees.
4. Who’s your go-to person? No doubt, your initial contact was someone on the third party processor’s sales team. You’ll also want a list of additional contacts to have on speed-dial, such as the technical support team.

Adding alternative payment methods to checkout is a savvy way to boost revenue and control costs. But as with any other business deal, be sure to read and fully understand the terms and conditions of the contract—this is critically important when it comes to the complexities of payment processing.

What additional tips can you share with fellow merchants who might be on the verge of signing a contract with a third party payment processor?

Ecommerce merchants lose more revenue from the fear of fraud than from actual fraud—6x as much revenue to be exact, according to the Federal Trade Commission. Eye-opening figure, isn’t it? And digital consumers have reason to be wary of sharing credit card or bank account information for online transactions. More than 11 million U.S. adults were victims of fraud in 2009, the highest level since 2003. The good news is there are tactics digital merchants can implement to make customers feel safer when shopping online.

So how do merchants take the fear out of shopping ecommerce stores?

1. Offer alternative payment methods (APMs). One of the easiest ways to give consumers peace of mind is by giving them shopping cart payment options that don’t ask for sensitive information. Third party payment processors provide alternative checkout options, such as Bill to Phone (LEC billing), which allows shoppers to charge purchases to their phone bill. No matter which APM you choose, invest in a third party payment processor with a platform that integrates smoothly into your current system for a seamless checkout—a feature that will boost customers’ confidence in the transaction.
2. Invest in an SSL certificate. This security software encrypts information transmitted between the customer and the digital merchant. Remember to feature the security logo or seal prominently to let shoppers know you’re doing your part to keep online shopping safe.
3. Outline an easy-to-understand privacy policy. Customers want to know what you’re going to do with the information they’re sharing, whether it’s their email address or credit card number. Post the privacy policy in clear language that the ecommerce shopper won’t need a legal expert to interpret.

What tips can you share for taking the fear out of ecommerce shopping?

Your customers have the need. You have the product. Traditionally, credit cards have been the way ecommerce merchants and customers have completed that transaction. But between rising credit card interest rates and the fear of identity theft, consumers may not be as comfortable breaking out the plastic to subscribe to a service or download digital content; that’s why merchants who want to lift revenue and expand their market add alternative payment options to their checkout.

When it’s time to invest in a third-party payment processor, ask the company these four questions:

• Do you offer validation services? You don’t like uncollectible accounts, so choose a payment processor who helps you reduce exposure with a process that verifies the customer’s identity.
• Will you help me maximize my revenue potential? A quality third-party payment processor is more than just a money handler. The right partner will monitor the transactions and suggest adjustments to reduce your exposure to bad debt and build revenue potential.
• Do you have experience as a third-party payment provider? You’ve invested considerable time and resources into completing that sale, so it’s vital to partner with a company who can navigate the digital world as well as payment processes. The result should be transactions that are seamless and satisfying for you and your customers.
• How do you interact with my customers when they have questions? When buyers have a question or problem with a payment method, you want a third-party processor who addresses issues quickly and professionally. Look for a firm that offers a range of customer touchpoints, such as toll-free numbers or an online self-help center.

If it’s time to look for an alternative payment method, such as LEC billing, contact ILD Teleservices. Our team delivers the payment processing tools you need and the service you deserve. Learn more today.