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Why should you use a fraud prevention tool?

Why should you use a fraud prevention tool?

Users occasionally ask us why they need a third-party fraud prevention provider. After all, no one knows your buyers and your business better than the merchants themselves. In this article we will give you some advantages of using external fraud prevention tools, such as Bayonet.

How can a fraud prevention tool help you?

The main objective of any trader is to grow their business and generate income effectively, using their limited resources as efficiently as possible.


A key constraint is the availability of talent. The first challenge a merchant faces when building their own fraud prevention solution is the shortage of experienced talent in the market. In particular, e-commerce in Latin America is growing much faster than the availability of talent. This is even a global trend, resulting in quite high salary levels among prevention industry experts. Thus, third-party fraud prevention providers typically attract a select group of industry experts who develop the product and work with third-party consultants to service merchants.


Fraudsters often target many businesses, often in the same industry and over the same period of time. A single trader and/or analyst is not able to identify such a systematic pattern in the market. By contrast, a third-party provider like Bayonet can harness all of your network data together, using cutting-edge technology to compare millions of patterns in real time.


According to "Emarketeer" ( Mexican e-commerce is the fastest growing in the global market in percentage. Building a system and processes that can sustain such growth is an engineering and financial challenge for any business.

According to data collected by VISA, the average rate of manual transaction reviews for fraud prevention in Latin America is 28% of total orders ( lac/ENG/Default/Documents/PDFs/online-fraud-report-2016.pdf). Latin America is one of the riskiest global markets, which partially explains the high percentage of manual reviews. On the other hand, many merchants lack the tools to automate their fraud prevention decision making. Manual review processes cannot be scaled in an exponentially growing market, so merchants need to automate their processes and be more selective about which transactions actually require manual review.

Estos son los 10 fraudes digitales más cometidos en tiempos de Covid-19


A popular method for scaling such a process is "outsourcing." Several fraud prevention providers offer outsourced manual review service. These providers and their employees have very strict KPIs, however, this can be a very expensive alternative. Additionally, the people doing the manual reviews may not fully understand your business and may be more interested in increasing your KPIs than in figuring out the balance between security and business profitability.


A modern machine learning platform achieves a high level of automated decision making. Only transactions with a high risk profile or a high transaction amount will be considered for manual review. This allows merchants to allocate resources efficiently and scale smoothly.


The main cost factors for building an effective fraud prevention system are:

  • Specialists in electronic commerce and fraud
  • datA ANALYST
  • Machine Learning ENGINEER
  • Sistems BUILDING

To get started, you need to understand the problem. This requires the help of a data analyst, who reviews the transaction information to calculate the acceptance and rejection rates, as well as the current fraud and chargeback information that the merchant receives from the merchant. acquiring bank. In this way, they manage to identify patterns to effectively block future fraud attempts. Based on these patterns, a development team must build a fraud prevention system with configured mechanisms to stop these purchase attempts.

Operating systems of this type implies a continuous effort, which is why it generates recurring costs. It is very likely that as a merchant you will not be able to develop all these functionalities yourself and you will need to hire a third party to improve the capabilities of the system, for example, to verify email domains or to obtain "device fingerprints".

Fraudulent attacks occur in very short time frames, while the pattern of fraud can change on its own or evolve very quickly and in very complex ways. This is why modern fraud prevention systems are built using Artificial Intelligence or Machine Learning, which creates additional cost, as very specific engineering skills are required for this to happen. Also, building a basic system could take 9–15 months.


Building your own anti-fraud solution is no guarantee of success, as it can become very expensive and difficult to manage. Fraud is highly complex, patterns change rapidly while at the same time an exponential number of data parameters need to be executed by the system to provide concrete and accurate decisions. Keeping up with these changes is a very tough challenge that should not be underestimated. Eventually, the effort to combat fraud could become an intense distraction, instead of focusing the company's effort on growth and achievement.

Cómo prevenir los fraudes online en las empresas? – Galdón Software

Agenda una demo

Bayonet operates an effective prevention platform, built on state-of-the-art technology, designed for exponential growth. Using graph database technology and a highly scalable cloud architecture, Bayonet is capable of running millions of data parameters across its merchant network and transaction/chargeback history. Bayonet focuses on a maximum level of automated decisions, so merchants can focus on their core business and only review transactions with critically high suspicion of fraud.

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