Businesses across the globe must have threat prevention strategies in order to protect their organisational and customers’ data. Having a mitigation strategy for BIN attacks is a crucial part of this process, and building proactive steps to prevent BIN attacks can fortify a business’s sensitive data. So, what is a BIN attack, and how can your business protect itself from it? Let us explore.
What is a BIN Attack?
A BIN attack occurs when cybercriminals use brute-force techniques to crack credit card information, including the card number, expiration date, and CVV. Unlike individuals guessing one combination at a time, attackers employ software that can test thousands of possibilities in seconds. Once they find valid card details, they may execute small transactions to verify card activity. If successful, they exploit these cards for larger fraudulent purchases or sell the information on the dark web.
What does BIN mean?
A Bank Identification Number (BIN) refers to the first six to eight digits on a payment card, known as the issuer identification number. These digits identify the financial institution that issued the card and help the payment processing system direct transactions accurately for verification and reconciliation. Beyond facilitating seamless refunds and chargebacks, BINs play a critical role in preventing online fraud by verifying the cardholder's location against the transaction attempt while safeguarding sensitive data.
A BIN attack usually unfolds in three key phases:
- Collecting: The fraudster begins by gathering potential card details. Using publicly available BINs from banks, they employ bots to cycle through random numbers, attempting to guess valid credit card combinations. Automated number generators facilitate rapid, large-scale guessing, increasing their chances of success.
- Validation: After generating these card details, the attacker moves on to validate them. They attempt small purchases with various merchants, carefully selecting transaction amounts low enough to avoid triggering fraud detection systems.
- Testing: Once they identify working card details, they store these "cracked" cards in a database for future use, whether for larger purchases or selling on the black market. This systematic approach allows them to exploit vulnerable accounts while evading security measures.
By understanding these phases, businesses and consumers can better protect themselves against the threat of BIN attacks.
Types of BIN Attacks
BIN attacks can take several forms, each targeting vulnerabilities in the payment system:
- Generating Random Card Numbers: Fraudsters begin by focusing on the BIN of specific financial institutions. By identifying the initial six to eight digits of valid card numbers, they set the stage for their attacks. Since this only represents a small part of the full 16-digit number, they employ automated tools to create thousands of potential combinations. This efficient guessing significantly enhances their chances of success.
- Testing Credentials: After generating these card numbers, attackers validate their authenticity by making numerous low-value transactions. Using automated software, they can execute these transactions quickly and at scale, minimising the risk of detection while probing for valid cards.
- Targeting a BIN: By concentrating on the BIN of a specific bank, fraudsters know they have at least six to eight digits of a valid card number. This targeted approach improves their odds of finding usable card details.
- Card Details Storage: If a transaction is successful, criminals store these card details for future exploitation. They can then conduct larger fraudulent purchases until the card is cancelled or its authentication details are modified
Impact of BIN Attacks on Businesses
BIN attacks can severely impact merchants, leading to several consequences, such as:
Reputational Damage
Merchants risk losing trust with financial institutions and customers. Payment partners may consider your business too risky, possibly severing ties, while customers might blame you for insufficient fraud prevention and avoid your platform.
Chargebacks
Fraudulent transactions result in chargebacks, which are both costly and time-consuming to resolve, affecting your bottom line.
Fines and Penalties
Merchants who fail to prevent BIN attacks may face fines from regulatory bodies and could even risk losing their payment processing licences.
How to Detect and Respond to BIN Attacks
Detecting and responding to BIN attacks involves a multi-faceted approach to security that addresses vulnerabilities at various levels:
- Behavioral Analytics and Machine Learning: Leverage advanced machine learning algorithms to identify unusual transaction patterns. These systems learn from historical data to adapt to new fraudulent tactics.
- Tokenization and Encryption: Go beyond basic encryption by implementing tokenization, which replaces sensitive card details with unique identifiers that are useless if compromised. Consider advanced cryptographic techniques for added security.
- 3D Secure 2: Adopt the latest version of 3D Secure to enhance authentication for online transactions, which also simplifies the user experience while strengthening fraud prevention.
- Network-Level Fraud Detection: Employ analytics to monitor network traffic for suspicious activities and signs of data breaches.
- Rigorous Authentication: Utilize biometric verification methods, such as facial recognition, to bolster authentication, particularly for high-risk transactions.
- AI-Powered Risk Scoring: Integrate AI systems that evaluate transaction risk in real-time, allowing for immediate action on high-risk transactions.
- Cross-Channel Analysis: Monitor different transaction channels to detect patterns of fraudulent activities and analyse geolocation data to identify anomalies.
Implementing these strategies can significantly enhance your defences against BIN attacks, ensuring a safer transaction environment for both merchants and consumers.
BIN Attack Fraud Prevention Method
How Consumers Can Prevent BIN Attacks
While consumers cannot prevent BIN attacks from happening, they can take proactive measures to safeguard their accounts. Here are some effective strategies to help you stay secure:
- Set Up Transaction Alerts: Enable notifications for all purchases, even those as low as one cent, to quickly identify any suspicious activity.
- Use Multifactor Authentication (MFA): Opt for MFA to enhance your security by requiring a combination of something you know (like a password) and something you have (such as a mobile device).
- Shop Securely: Only shop with merchants that utilise security features like Verified by Visa (VBV) or Mastercard SecureCode. These prompt you for a one-time password during online transactions.
Staying vigilant and using these precautions can help protect yourself from potential fraud.
How Businesses Can Prevent BIN Attacks
Businesses have several strategies to mitigate the risk of BIN attacks effectively. Online merchants can leverage PCI-compliant gateways to thwart credit card testing. If a surge in chargebacks is detected, employing chargeback analytics can help identify potential BIN attacks. Here are five more strategies for businesses:
- Utilise Fraud Detection Software: Implement software that can analyse transaction patterns and flag suspicious activity, helping to catch BIN attacks before they escalate.
- Adopt a Bot-Management Solution: Solutions like Arkose Labs can shield e-commerce sites from bot-driven attacks while enhancing conversion rates.
- Implement Multi-Factor Authentication (MFA): Adding MFA provides an additional security layer, complicating the process for cybercriminals attempting BIN attacks.
- Use Address Verification: This method ensures that the billing address provided by the customer matches the address on file with the card issuer, confirming the legitimacy of the transaction.
- Educate Employees: Regular training on identifying and reporting suspicious activities can empower staff to recognise potential threats and handle transactions securely.
By integrating these practices, businesses can strengthen their defences against BIN attacks and protect their customers effectively.
Avoid BIN Attacks with the Right Payment Solution
Safeguarding your business against BIN attacks is crucial for maintaining trust and security. With Juspay's advanced payment solutions, you can implement advanced security measures to protect your transactions from BIN attack fraud. Explore our offerings today to enhance your payment security!
