Why Email Verification and GEO IP Location is Important for Ecommerce Fraud?

Email verification and GEO IP location are important for ecommerce fraud prevention because they can help verify the identity of a customer and the location from which they are making a purchase.

The world of ecommerce is rapidly growing and evolving. With more people turning to digital shopping, it has become increasingly valuable for businesses to have a solid online presence.

However, with more transactions on the web, there has been an increase in the number of fraudulent activities. This is because bad actors use unethical activity to make money off another person’s hard work or resources without giving anything back.

As an online merchant, how do you prevent this from happening?

At OPMC, we build custom plugins for popular ecommerce platforms like Shopify, Magento, BigCommerce, and WooCommerce. That includes Anti-Fraud plugins that help you target GEO IPs across the globe. We have the insight and experience to help you protect your online store. Read on to learn more about leveraging email verification and geotargeting to solidify your online protection from fraudsters.


What is Ecommerce Fraud?

Ecommerce fraud is a type of financial crime that occurs online. It can be perpetrated against individuals and businesses, but the latter are more common as they can access extensive inventories of payment information and customer data.

For example, a fraudster may purchase hundreds of stolen credit card numbers and use a software program to try and place orders on your website, costing you thousands of dollars overnight with your merchant services.

How Does Email Verification Help Prevent Ecommerce Fraud?

You should verify an email address at account creation and at checkout. This is because if you only verify an email address when someone makes a purchase, it’s easy for fraudsters to create an account with a fake email address.

With this approach, you can be sure that the customer has access to the correct information needed to complete the order, and you don’t risk exposure to a bunch of throw-away email accounts.

You should also check if the email address complies with the syntax of an email. An email address is composed of several components:

  • [Firstname].[Lastname]@[example.com]. For example, joe.smith@example.com or kate@example.com
  • The username should be in lowercase letters
  • The domain name can be anything, but you will traditionally have more of the .com or @google/@outlook addresses than others.

Finally—and this one gets its own bullet point because it’s imperative—you should also use a third-party verification service to verify email addresses regularly. Again, there are thousands of plugins, extensions, and apps available on the major ecommerce platforms you are using to help with this level of protection.

What is Geo IP Location?

GEO IP Location is a way of checking the location of a computer or device on the internet. It uses an IP address to determine where the device is physically located and what country it’s in, which can be very useful in fraud detection and prevention.

IP addresses are given out by a service provider, who assigns them depending on where you live. The first 3 numbers in your IP address determine what country you’re in (e.g., 44 = United Kingdom), while the last 2 numbers tell us what city or local area you are in (e.g., 14 = London).

Why is having GEO IP location important for online merchants?

GEO IP location is one of the most essential features that an ecommerce fraud prevention service should have. If you don’t know where your customers are located, then it will be difficult for you to identify and prevent any possible fraud.

For instance, our Anti-Fraud plugin uses blacklisting to eliminate orders from countries or regions around the world where known fraudsters tend to operate the most. It ranks every order based on recognized security risks and then automatically flags them for your review or puts a halt on the order altogether. This way, you are no longer responsible for the transaction.

GEO IP location allows merchants to determine the customer’s country, city, zip code, area code, and phone number. It also helps identify whether the customer is a local or international buyer based on their region code (NPA/NXX).

What Else Should You Watch For?

Sometimes, the billing address and IP address do not match. This can be a red flag for fraud because an ecommerce merchant should know where their customers are located when they make purchases.

If a customer’s billing address is different from their IP address, it might indicate that someone is trying to use a fraudulent credit card or PayPal account to make purchases online. 

Fraudsters will often try to change the billing information on their accounts so that it matches their fraudulent identity rather than their true identity (which could result in them getting caught).

Overall, email verification and GEO IP location are important tools for ecommerce businesses to use to help prevent fraud and protect their customers and their own interests.

Practical Anti-Fraud Tools for Ecommerce Operation

With practical tools to help you reduce fraud, you can run your ecommerce business confidently and bring in more revenue.

Email verification helps reduce fraud by verifying addresses at account creation and checkout. In addition, GEO IP location identifies fraudsters outside your target customer base, such as those from China or Russia.

While there is no 100% method to stay secure from ever-evolving fraudsters, using a powerful plugin like our Anti-Fraud option for WooCommerce is an excellent start. The more preventative tools you have in place, the less time and money spent trying to recover from any of these types of attacks.

Ecommerce fraud is a serious threat for online merchants, but you don’t have to be afraid of it. There are many solutions available to help you prevent fraud and keep your business safe. Email verification and GEO IP Location are two simple and effective ways to reduce the risk of ecommerce fraud. They will help you have a more rewarding experience as you build your online store empire!


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