Fraud is a major problem for online marketplaces. Scammers can use fake identities and addresses to create accounts, list items for sale, and then collect payments without ever delivering the goods. This can cost marketplaces a lot of money and damage their reputation.

One way to prevent fraud is to verify the physical addresses of users who create accounts on your marketplace. This can be done by using a service like PCM Integrations, which will send a postcard to the address provided by the user. The postcard will contain a unique code that the user must enter into their account to verify their address.

This process is relatively simple for users, but it can be a major obstacle for fraudsters. If a scammer provides a fake address, they will not be able to receive the postcard and will not be able to verify their account. This will prevent them from creating an account and listing items for sale on your marketplace.

In addition to preventing fraud, verifying physical addresses can also help to improve the overall experience for users on your marketplace. When users know that their addresses are verified, they can be confident that they are dealing with legitimate sellers. This can lead to increased trust and satisfaction, which can in turn lead to more sales.

Here are some of the benefits of verifying physical addresses:

  • Reduces fraud: As mentioned above, verifying physical addresses can help to reduce fraud by making it more difficult for scammers to create fake accounts.
  • Improves trust: When users know that their addresses are verified, they can be more confident that they are dealing with legitimate sellers. This can lead to increased trust and satisfaction, which can in turn lead to more sales.
  • Makes it easier to track down users: If a user does commit fraud, verifying their physical address can make it easier to track them down. This can help you to recover your losses and protect other users from being scammed.

Here are some additional stats from the Federal Trade Commission (FTC):

  • Imposter scams top the Fraudulent Five. In terms of the number of fraud reports received, #1 on the list is Imposter Scams, followed by #2 Online Shopping, #3 Prizes, Sweepstakes, and Lotteries, #4 Investments, and #5 Business and Job Opportunities.
  • FTC reports losses to investment scams more than doubled from 2021 to 2022, reaching a total of $3.8 billion.

Verifying physical addresses can help to protect your marketplace from these types of scams. By making it more difficult for scammers to create fake accounts, you can help to reduce the number of fraudulent transactions on your marketplace.

If you are considering verifying physical addresses for your marketplace, here are some things to keep in mind:

  • The cost of verifying addresses can vary depending on the service you use. PCM Integrations offers a variety of options to fit your specific needs.
  • You will need to decide how often you want to verify addresses. Some marketplaces verify addresses every time a user creates an account, while others only verify addresses when there is suspicious activity. These triggers can easily be set up through PCM Integrations API or through our Zapier integration.
  • You will need to make sure that your users are aware that their addresses will be verified. This can be done by adding a privacy policy to your website or by sending an email to your users.

Overall, verifying physical addresses is a valuable tool for preventing fraud and improving the overall experience for users on your marketplace.

If you are looking for a way to protect your marketplace from fraud, I recommend considering this option.

Schedule a demo today with PCM Integrations and see how easy it is to automate your verification postcard process.