Recent data breaches have customers on edge. They refuse to give their business to a company that fails to safeguard their security. While they may be forgiving of large brands, they will crucify small ecommerce companies that fail to adopt the right security solutions. If it even appears that your ecommerce site isn’t properly secured, you can say goodbye to your customers forever.
Fortunately, developing better security solutions isn’t difficult.
Optimizing Your UX with Better eCommerce Security Solutions
Sometimes, e-commerce seems like magic. From the comfort of your home, you can peruse millions upon millions of products, and after punching in a few numbers, those products can be at your door in a matter of days. It’s everything anyone could want from a transaction — for both consumers and businesses alike.
There is something sinister about the ease with which you can buy things online, though. Typically, when you purchase something from the store using a credit or debit card, you must prove your identity in one way or another, be it entering a PIN or signing a receipt. Yet, online, businesses rarely ask for authentication. As e-commerce expands and businesses begin offering more valuable items and services over the web, it’s likely that there will need to be added layers of authentication and security in the checkout process — which might mean you need e-signature services.
How E-Signatures Work
Before delving into how digital signatures work, we should review how physical signatures assist in securing transactions. When you make an in-store purchase with a credit card, you must verify your purchase in one way or another. In other countries — including most of Europe —cards use the chip-and-PIN system, where users input a personal number to confirm their identity and endorse the purchase. In America, even after adopting security-conscious chips in most payment cards, we continue to rely on signatures for security purposes.
However, signatures hardly work like most cardholders expect. Though some stores do compare receipt signatures with the signatures on the backs of payment cards, signatures aren’t meant to verify identity. Rather than protecting consumers from identity theft, they protect businesses from sustaining those costs. In fraud cases, if a store can produce a signed receipt, banks are responsible for reimbursing fraudulent charges. Yet, when a card isn’t present — as is the case with online purchases — merchants automatically assume that liability.
Signatures can protect merchants from fraud-related charges regardless of whether purchases occur online or in-person. You don’t need to sustain unexpected expenses just because you run an e-commerce business; instead, you should protect yourself with e-signature services.
Embracing e-signatures will make a big difference in 2018. By 2022, demand for e-signatures will rise by 32%.
Current E-Signature Requirements
It is important to note that not any digital scribble will suffice as authentication for an online purchase. Because online merchants cannot see cards or cardholders, it is much easier for criminals to input payment information and forge a signature during digital transactions. Thus, there are restrictions on what e-signatures are considered valid.
The Electronic Signatures in Global and National Commerce Act (ESGNCA) explains that only e-signatures that employ encryption are acceptable for authorization of purchases. Typically, e-signature services utilize “double key” encryption, which allows signers to create both private and public keys: Private keys are assigned to individuals and masked by public keys, which are used to verify identity and certify authenticity. While double key is the most common e-signature style, there are other options which vary in security, including swipe-able signature cards, biometric signatures, and images of handwritten signatures. Also included in ESGNCA are rules about storing e-signatures properly. To be usable, private keys and public keys cannot be easily accessible by hackers, so e-signature services or businesses must have strong cyber security measures in place to protect digital signatures.
There are talks of unifying e-signature options to aid in the adoption of digital signatures and reduce opportunities for identity thieves and cybercriminals. Until the government offers a practical and dependable e-signature option, you must find your own reliable e-signature service.
Considerations of E-Signature Services
Though e-commerce might be old news, e-signature services are still relatively new. Therefore, as you research possible e-signature services, there are three considerations you should keep in mind:
E-signatures are only as trustworthy as the signing processes. An e-signature should be much more than a checkmark in an “I Agree” box — and it should be much more than an in-person signature, as well. When done right, e-signatures provide businesses with incontrovertible proof that the true card user agreed to the purchase.
E-signature laws vary from place to place. ESGNCA truly only governs e-signatures in the United States. The European Union has another set of regulations regarding e-signatures, and various individual countries do, too. If you do international business, you should consider other e-signature laws when developing your transaction process.
E-signatures are becoming essential. Given the obstacles to establishing an e-signing process, many businesses are opting to risk fraudulent charges. However, cybercrime is on the rise, and if your business isn’t properly protected, it could crumple under the weight of chargebacks. With signatures, it’s better to be safe than sorry.
Protect Your Brand Image With E-Signatures
Online fraud is a growing concern for many businesses. The immediate financial risks are significant, but the blow to your reputation may be much longer lasting. Setting up e-signatures is an important way to keep your business safe.
About Annie Qureshi
Annie is an entrepreneur and startup investor. She embraces ecommerce opportunities that go beyond profit, giving back to non-profits with a portion of the revenue she generates. She is significantly more productive when she has a cause that reaches beyond her pocketbook.