As the delays to the roll out of SET continue, an Australian e-commerce service provider has produced what it claims is the world’s first cyber fraud insurance product.
The product, called Pure-protect, is said to cover online merchants against fraudulent transactions and subsequent charge back fees imposed by banks.
Currently in the case of e-commerce, “merchants are the real losers,” said Daniel Lavecky, managing director of product development, Pure Commerce. In a fraudulent transaction, the merchant, rather than the card holder, bears the brunt of resultant charges and is not protected by their bank or insurance company.
The promise of SET (Secure Electronic Transaction) is that it will help fight against such cyber fraud with digital certificates, an electronic version of a signature. While SET is still some way from being realised, Pure-protect aims to protect merchants with Internet shopfronts now, said Mr Lavecky.
The technology uses an artificial intelligence, integrates a number of
check points that scan the history of the credit card, and assesses the cost of the online purchase. If a transaction is deemed fraudulent the merchant is protected and the user must pay bank charges.
Although Pure-protect “plays the odds” like an insurance company to
establish whether the merchant is a good risk, Mr Lavecky said that the
demand for it is evidenced by the lack of protection given to merchants in the case of fraud, and by the conservative nature of banks and insurance companies when protecting online vendors.
Developed in Australia by Pure Commerce, Pure-protect will be launched at
the Internet World Australia Pacific 98 Conference and Exhibition in
Sydney, Australia from August 11 to 13, 1998. It will be released at a
later stage in the United Kingdom and the USA, and Mr Lavecky said it will
eventually be available to merchants around the world.
