Address verification is a very essential part of the identity authentication process in business. Along with other means of verification, it provides an additional data point for identity authentication. Businesses must ensure that they have been provided the right address for mailing. In the U.S., losses due to e-commerce fraud were globally projected to be about $41 billion and this figure is expected to grow even further. This is mainly because of a lack of proper verification services to confirm the customers’ residential details, which perpetuates the need for stronger controls. Businesses need to ensure that products purchased online are being delivered to the right addresses to avoid huge losses and correction fees. Thus, proper address authentication policies would help businesses overcome several such challenges.
Process of Verifying Addresses
Verifying addresses of customers ensures that orders are sent to the correct destinations. This helps to avoid misunderstandings and errors. Businesses can verify addresses in several ways.
The addresses of customers can be verified using payment gateways that provide features for fraud prevention. These procedures involve confirming the customer’s name and contact details, but they also include verification of address. Some of these gateways can provide the level of risk or potential fraud score for upcoming transactions. For this, many factors are taken into consideration such as the customer’s location, IP address, consumer behaviors, etc.
Another method that is more specific to online address verification is using shipping carriers that provide address authentication features. These features may comprise checking the address format, accuracy, and spelling. Some carriers can also confirm the delivery whereby the customer confirms the delivery on one end and the company receives the confirmation on the other. This would confirm that the order has reached the right customer. A tracking number can also be useful to track the location of deliveries.
Another method to verify addresses is to adopt third-party tools that offer address identification services. These tools would confirm customer addresses by running checks with the data in databases and then offer an alternative if the address is incorrect, insufficient, or suspicious. Some of these tools can locate the coordinates of a location via geocoding.
E-commerce Challenges and Solutions
Even though the world has become increasingly digital, certain challenges to e-commerce transactions make it necessary to have appropriate controls in place to validate addresses.
Sometimes, customers may provide inaccurate information like their address. This may be indicative of fraud or human error. In such cases, businesses can contact customers digitally or a link may be sent to them that may ask for confirmation of their address. Proper AI-driven address verifying processes would enable companies to make this procedure quicker and more trouble-free as their details can be re-verified from databases.
Businesses can also verify whether the provided addresses are commercial or residential. Sometimes, customers falsely claim their residences to be commercial to avoid excessive shipping costs. So, an AI-based address verification system can immediately identify whether the address is residential or commercial when the customer is filling out the details. It will only allow them to move forward after it is corrected. This way they can ensure that the delivery will reach the correct address.
Verifying addresses of customers ensures that orders are sent to the correct destinations. This helps to avoid misunderstandings and errors. Businesses can verify addresses in several ways.
Another instance where a challenge may arise is when a customer purchases a product, uses it for some time, and then submits a chargeback claim stating that the product was not received. The lack of a proper address verification procedure might cause such discrepancies to go unnoticed. With an online address authentication system, such claims can be thoroughly investigated before companies act on them. They can, thus, ensure whether the claim is authentic.
All in all, proper address authentication procedures help businesses overcome such challenges where mistakes are made or information is falsified. Verifying an address can save businesses a lot of trouble and help them avoid legal penalties.Businesses need to ensure that products purchased online are being delivered to the right addresses to avoid huge losses and correction fees. Thus, proper address authentication policies would help businesses overcome several such challenges.
Conclusion
In e-commerce businesses, incorrect addresses are a big inconvenience. They can damage the reputation of businesses, not to mention increase their shipping costs. Therefore, businesses must have efficient and effective address verification procedures that ensure that deliveries are made to the right address. This will establish trust with customers and also maintain their reputation. Businesses are realizing the significance of address authentication as a major part of KYC verifications. Thus, they are taking steps to implement measures to combat fraud or inaccuracies.Businesses need to ensure that products purchased online are being delivered to the right addresses to avoid huge losses and correction fees. Thus, proper address authentication policies would help businesses overcome several such challenges.
