How to prevent refund fraud in gift card sales?

Solved

How to prevent refund fraud in gift card sales?

WAGYUMAN
Tourist
4 0 3

There have been many cases of people purchasing gift cards in our store and then having their chargeback cases opened after the gift cards have been used.
We would like to continue to sell gift cards after this.
Is there a method or app that would do an ID check only on the person who purchased the gift card?

Accepted Solution (1)

EcomSol
Excursionist
20 3 5

This is an accepted solution.

Shopify does not provide a built-in method for ID verification during the purchase of gift cards. However, you can try to mitigate chargeback cases by using a third-party app that offers ID verification, such as Jumio or Onfido. These apps use various methods to verify the identity of the customer, such as checking their government-issued ID or conducting a facial recognition check. By implementing such a solution, you may be able to reduce the risk of chargeback cases.

I hope this helps! Let me know if you have any further questions.
Best Regards!
Ecom Solutions

View solution in original post

Replies 5 (5)

EcomSol
Excursionist
20 3 5

This is an accepted solution.

Shopify does not provide a built-in method for ID verification during the purchase of gift cards. However, you can try to mitigate chargeback cases by using a third-party app that offers ID verification, such as Jumio or Onfido. These apps use various methods to verify the identity of the customer, such as checking their government-issued ID or conducting a facial recognition check. By implementing such a solution, you may be able to reduce the risk of chargeback cases.

I hope this helps! Let me know if you have any further questions.
Best Regards!
Ecom Solutions
WAGYUMAN
Tourist
4 0 3

Thank you

heavyend81
Excursionist
12 0 4

We had this very same issue with Shopify Gift Cards whereby several purchases were made using a gift card (set up in the Shopify gift card facility) together with a credit card where part of the purchase was a small amount on the credit card side. My thought was a possible chargeback later down the line. Fortunately we spotted it early after there were 8 attempts consecutively using gift card amounts way above our limits that had been set. I spoke to Shopify support who where ok but not at all concerned about it in terms of fraudulent activity and how easy it was that a hacker could bypass their systems. We were advised to just cancel the order, which is what we did but as a result I will not use the gift card facility on Shopify as it poses an obvious security risk.  The solution made me chuckle, all it says it use another app !. Fat lot of use that is, Shopify need to seriously address the issue.

Buntiform
Tourist
27 0 3

Like the accepted answer says, you’d need a third party fraud prevention plugin. But in addition to their recommendations, you should also check out IPQualityScore.

heavyend81
Excursionist
12 0 4

No worries, I gave up on the Shopify Gift card facility ages ago. Unless you use one of their bona-fide Themes it does not fully function, such as the option to send gift card as a gift to another person. So, if have any theme other than one of Shopify's then just use a third-party Gift Card app. I eventually settled on Go Gift Cards which is just perfect for our needs. There are many options in the paid version that could be used but in the basic (£3pm) one it is just perfect where it allows you to send a gift card to anyone for any denomination. On the fraud prevention side, we found that not having the option to automatically capture orders activated as this at least gives you time to scrutinise the order details before accepting any order. Shopify Gift cards alone do have a problem with fraud I have discovered from other chat forums. All is working fine for me now.