Of course, we should all be using encryption technology and SSL certificates on our e-commerce and subscription payment pages (or s-commerce pages, as I like to call them). As Dubrow explained, you should definitely state whatever safety measures you take, like “using encryption technology.” But stating outright that your site is “safe and secure” can get you into a lot of legal hot water, especially since no site is that secure. We’re all vulnerable to hackers and identity thieves, and any security breech can open you up to a lawsuit if you claimed to be “safe and secure.”

You’ll also want to use those secure icons from vendors like Verisign and TrustE only if you have a licensing agreement with the vendor. And you should definitely test your wording and icon placement — different audiences respond differently to such assurances.

For more information on data collection crackdowns, privacy policies, and how to best notify your customers to any changes in your terms of service, check out the instant replay of Dubrow’s presentation.

It’s a good-enough rubric, since high chargeback rates can get you flagged for merchant malfeasance by credit card companies. However, it may not be as applicable for niche publications.

I recently spoke with leading payment processing expert Paul Larsen, who informed me that the 1% rate is really for high-volume businesses — sites with more than 10,000 transactions a month. That’s because credit card companies take volume into account when flagging merchants. For example, Visa only flags a merchant with 100 individual chargebacks in a month when those 100+ chargebacks make up at least 1% of the merchant’s total transactions. If you have fewer transactions — say a subscription base of 3,000 — and 100 chargebacks, you’re probably not going to get flagged (although you may want to read how to minimize your chargebacks on our sister site, Subscription Site Insider).

Of course, rates vary by credit card company, and some, like American Express, have a complex algorithm that’s impossible to predict. And any chargeback is bad news, since you’re not only refunding money, but also paying a transactional fee and steep fine. Better to issue a cancellation and/or refund and ensure customer goodwill than wait for a chargeback. But a few here and there shouldn’t put you out of business.

Consumer Reports Online, which has been able to increase their subscription revenues by charging separately for print and online subscriptions, employs one of the most lucrative best practices by using an account updater service for their payment processing. For those of you unfamiliar with account updater services, it’s a simple software service that runs all your subscribers’ credit card numbers once a month against a list of everybody in the United States whose Visa/MC number has changed that month for whatever reason. The software then updates the customer’s credit card number without bothering the customer.

This practice has been known to significantly increase retention and revenues for subscription and membership sites with minimal effort.

For more tips on dealing with chargebacks and credit card declines in order to increase retention and revenues, check out the on-demand video talk by Paul Larsen on Subscription Site Insider. For more killer marketing tips, read the full case study on Consumer Reports Online now!

EMV (which actually stands for Europay, Mastercard and Visa) uses a digital chip to encrypt card data, much more secure than the current magnetic strips. The push will mainly be for bricks-and-mortar stores to update their technology to read the cards by 2015. However, bricks-and-mortar updates have very serious ramifications for online merchants.

Randy Vaderhoof, Executive Director of the independent nonprofit Smart Card Alliance, spoke with me by phone today to explain how fraudsters migrate to online fraud when offline security is increased. Thus, financial institutions abroad, particularly in the U.K., have issued hand-held readers the size of a calculator to customers with EMV cards. Customers then scan their card, which issues a one-time password they have to enter to verify any online transactions. Some banks have also issued a “display” card, which are battery-powered cards with a display and button the cardholder can press to generate a one-time password.

There’s no news yet on what card manufacturers or financial institutions will be offering cardholders for online transactions, but subscription sites should start thinking now of how they can increase their security and decrease card-not-present fraud, which is likely to increase in the near future.

Recently, a U.S. District Court for the Eastern District of Texas banned the use of “remotely created payment orders” by Landmark Clearing, Inc. “Remotely created payment orders” allow merchants to enter a client’s name and bank number into a form and are cleared like a paper check, except that in lieu of a signature, the words “Authorized by Account Holder” or “Signature on File” appear. Federal banking regulations require the creator of a remotely created payment order to have the express authorization of a consumer to process the debit, but they are not subject to a lot of oversight, which makes them susceptible to fraud.

The FTC seems to have been tipped off by the exceptionally high chargeback rates Landmark’s clients were producing, sometimes higher than 80%. But the FTC didn’t just go after the merchants — they went after Landmark as well for promoting a service for merchants “with a high percentage of overall returns”.

Landmark is now banned from processing remotely created payment orders. Which means that sites that rely on recurring billing should be 1) seeking to reduce their chargeback rates as much as possible and 2) keeping an eye on their payment processor to make sure they’re on the up-and-up.

For tips on how you can reduce credit card declines and chargebacks, take a look at this on-demand video on our sister site, Subscription Site Insider.

Dwolla lets consumers pay bills and make purchases with the cash in their bank account when shopping online, a previously credit and debit-only platform. According to Business Insider owner and founder Ben Milne started Dwolla after losing $55,000 a year in interchange fees while running his first start-up.

By networking with financial institutions, Milne was able to create a platform that lets people pay for purchases through their bank account, including recurring payments. This can be good news as retailers no longer have to deal with card expiration dates or interchange fees (Dwolla bypasses the dreaded ACH system). People who get paid only get charged $0.25 (that’s right, a quarter) for every transaction, no matter how small or large.

However, it’s unclear whether there are any additional bank fees, and if not, whether it will remain that way. Also, payments may not go through if consumers don’t have enough money in their bank account, causing frustration for both you and your consumers. And since you don’t own the customer’s bank info, you cannot transfer it if you are sold, which has been a major problem for membership sites using other payment alternatives, such as PayPal.

In an unusual spin on typical membership site offers, Blokely offers weekly auto-renew subscriptions as one of its options. We predict this will be a nightmare for the payments processing department. The offer is strongly positioned as £2.50 pounds per week vs £3.95 per month, presumably to push men to a what-the-heck upsell. They’d do better, though, if they offered £3.50 pounds per week vs £3.95 per month, because then the savings are more overt. And, as every subscription marketer knows, really obvious works really well.

According to AllThingsD.com, 100 million Verizon subscribers will be able to use the new service to shop on any Internet-connected device, including a PC, phone or tablet. Subscribers will have to sign up for a Serve account through American Express, which can be funded by any bank account or credit card.  One potential hurdle  is that online retailer will also have to integrate Serve in order to take these payments. These various steps could make the road to widespread adaptation bumpy.

“Yes, they have to be Verizon and a Serve customer, but we are preloading a number of devices — smartphones or tablets — with the Serve app, and when you preload there’s a much greater uptake,” said Dan Schulman, group president, Enterprise Growth, American Express told AllThingsD.com. Amex’s deal with Verizon isn’t exclusive so American Express could be partnering with other mobile companies soon.

If you’re interested in learning more about credit card processing and accepting mobile payments for your subscription site, we have a collection of great payment processing resources at our sister site SubscriptionSiteInsider.com

• Reduction in fraud.  Netswipe turns a “card not present transaction” into an “online card” present transaction. A card present transaction lowers the risk of fraud significantly.
• Works with your existing payment provider.
• Customers might be more likely to complete a transaction? This is up for debate as the only data so far is from a focus group run by Jumio which concluded 79%  completed a transaction with Netswipe vs. 48% without.

One question I immediately asked when reading about Netswipe: Is this solution PCI compliant?  Here’s what Jumio says on its site: “If you use Netswipe Scanning or Netswipe Recycle Swipe you will need to demonstrate that your system can handle this data securely and that you are taking full responsibility for your PCI DSS compliance. One part of this is the need for us to see a clean Vulnerability scan being made on your systems.”

• Braintree is an all-in-one  solution – offering merchant account, gateway and recurring billing.
• The company is big on avoiding deceptive pricing and fee structures and offers a “truth in pricing” guarantee.
• Braintree takes PCI Compliance very seriously and it looks like it does a good job getting you set up with PCI best practices right away.
• Braintree doesn’t lock you into a contract and doesn’t charge a cancellation fee if you terminate your account.

Are you using Braintree as your payment solution? Give us your feedback below.