Risk Assessment

A Thorough Understanding Of Your Prepaid Program And The Current Fraud Tools You Have In Place

Few people enjoy talking about risk because they feel it is the ugly side of prepaid programs. This has created an unfortunate lack of information for prepaid program managers working to minimize risk.

Denial Or Ignorance - Not A Wise Strategy For Understanding And Controlling Risk

We see it all the time. A program manager takes on a prepaid card program without a real understanding of the risks involved. They rely on the issuer to know what the risks are and how to deal with them. The program manager believes they have a handle on fraud, but in reality they have only a limited understanding of what could go wrong. With few peers in the industry willing to speak openly on the topic of risk, the program manager moves forward with a false sense of security. Just days after their cards hit the market, millions of dollars in losses have occurred. Suddenly everyone involved is scrambling to
figure out why.

Experiencing A Lot Of Risk Losses But Don’t Know Why?

The team of payments professionals at E&S Consulting can help. Our team has extensive experience running prepaid programs of all types and sizes. We understand every type of prepaid program risk on the issuing and acquiring sides because we have faced it. Our Risk Assessment services help clients control the risk losses they have and mitigate risk in the future.

Stage 1: Developing An Assessment

  • Our Risk Assessment team first develops an understanding of your prepaid program and the current fraud tools you have in place
  • Assess what your risks are and what their controls should be
  • Prioritize the risks and provide a report that recommends various ways to mitigate those risks, including specific policies and procedures
  • Present an executive level presentation that summarizes the findings outlined in our Risk Assessment report

Stage 2: Post Risk Assessment

  • Many clients use our services to implement the recommended changes
  • Others elect to implement the most pressing changes themselves, scheduling less urgent recommendations for the future when their prepaid program grows

Is Risk Assessment Right For Me?

If you are not sure whether our Risk Assessment service makes sense for your prepaid program, consider the common sources of risk listed below and what controls and procedures, if any, your prepaid program has in place to mitigate these risks:
  • Issuing risk – risk of taking on a prepaid card program
  • Consumer risk – cardholders may commit fraud
  • Internal systems risk – risk of employee fraud such as running ACHs illegally to load cards or put money in their account
  • Distribution risk – happens at the employer or retail level and could be fraud, lost cards, lost distribution of
    cards, or shrinkage
  • Chargeback risk – it is very costly to process chargebacks in a prepaid card system so chargeback losses must be managed carefully to minimize loss
  • Acquiring risk - this risk is particularly problematic if prepaid cards are distributed on the Internet