Fraud Prevention Downtime Will Cost You Thousands 2 Minutes on Fraud: Episode 25
Episode 25 “Fraud Prevention Downtime Will Cost You Thousands”
Ninety-nine percent uptime for a fraud prevention solution is not good enough. That equates to approximately seven hours of downtime per month leaving companies vulnerable to a surge in fraud losses. Kount targets zero planned and unplanned downtime with an impressive track record for uptime. Ask your fraud prevention provider how many nines of uptime they have. If they experience frequent and lengthy outages, financial losses are inevitable and it’s time to look elsewhere.
Melayna Gabiou: While 99% uptime sounds good on paper, it's really not good enough.
As a merchant, software downtime can be really costly. It can cost them a surge in fraudulent orders, it can cost them increase in manual reviews, or it can also affect other internal processes that they may have. When a software company has a 99% up time, that equates to 1% in downtime, which also equates to about seven hours a month, and that's about almost a whole business day per month that the software can be down.
If we take that a step further and we say, for example, a company is processing 500,000 transactions a month, and their average ticket price is $100, that seven hours of down time would leave 16,000 orders vulnerable to not having fraud detection. If we have an average fraud rate of 1%, then 160 of those orders would be fraudulent, which also would equate to $16,000 in lost revenue. Honestly, that scenario is pretty generous and that's because fraudsters talk, and fraudsters network.
Let's say that company overreacts and decides to stop accepting orders altogether during that software down time. They could lose potentially 1.6 million dollars and have some really unhappy customers.
Kount targets zero planned, and unplanned, software downtime. Over the last three years Kount has averaged a 99.99691% uptime, and that equates to about 2.2 minutes of downtime per month. That's a really great benchmark for Kount. It's a really great benchmark for the industry and, honestly, for software companies overall.
A lot goes into maintaining Kount's high uptime. One of the strategies is we have multiple operating centers that have redundancy in their systems. They're also geographically dispersed.
The moral of the story is to ask your fraud-prevention solution, or ask your fraud-prevention team how much downtime they're experiencing, and the importance of that is every minute of lost time can result in lost sales.