Preventing Card Testing Fraud

Card testing fraud is one of the largest threats to modern e-commerce merchants, especially those in the United States. In recent industry studies, it has consistently ranked among the most common forms of payment fraud experienced by merchants in North America, alongside threats such as account takeover and refund abuse. It also cuts across the spectrum when it comes to business size, with small, mid-market, and enterprise businesses all reporting high rates of card testing fraud.

While the purchase amounts in card testing attacks are usually small, they hurt merchants in other ways as well. Depending on the transaction amount, successful tests may result in chargebacks for the merchant, and since card testing fraud usually takes place in large batches, a merchant could get hit with a whole lot of chargebacks all at once.

In addition, those chargebacks will increase the merchant's chargeback ratio, putting them at risk of financial consequences from chargeback monitoring programs such as the Visa Acquirer Monitoring Program (VAMP). In order to combat this threat, merchants need to know what card testing fraud is, how it works, and what they can do to prevent it.

What Is Card Testing Fraud?

Card testing fraud, also known as card cracking, is when a fraudster with a stolen credit card number makes a small purchase to check if the card is active and if the transaction bypasses the merchant's fraud detection measures.

If the small purchase is successful, the fraudster starts making larger purchases to get as much value as possible out of the card before the fraud is detected. In many cases, fraudsters sell validated card numbers on underground marketplaces for a higher price than untested credentials.

Fraudsters have to be careful with newly acquired payment credentials—too many declines on large or noticeable purchases can cause the card issuer to shut the card down before any meaningful fraud occurs. Often, fraudsters have incomplete credentials that will only work with merchants who lack effective fraud prevention tools, which is why small- to mid-sized businesses are frequently targeted.

Fraudsters will often test large batches of payment credentials at once using automated software. These credentials may come from data breaches, phishing campaigns, or by purchasing stolen payment data on the dark web.

Some fraudsters buy stolen payment credentials rather than obtaining them directly. For those who are especially effective at testing and monetizing stolen card data, card testing fraud can be a lucrative criminal activity.

What Makes Card Testing Fraud Dangerous for Merchants?

For merchants, card testing fraud can mean a large number of fraudulent transactions in quick succession. That can mean significant damage has already been done by the time the activity is detected.

Card testing is intended to be insignificant enough that it won’t raise immediate red flags if declined—even multiple times. If a transaction is authorized, the fraudster now has a successful payment history with that card and merchant, making subsequent larger purchases more likely to be approved.

Even declines can benefit fraudsters. Some payment processors return overly specific decline messages that reveal whether a failure was caused by an address mismatch, CVV error, or another issue. This information helps fraudsters determine which data points they still need.

Card testing fraud harms merchants in several ways. Even low-dollar test purchases often turn into chargebacks once the legitimate cardholder reviews their statement, contributing to unnecessary fraud disputes.

Declines are damaging as well. Excessive declines can cause processors to classify a merchant as high risk, leading to higher fees or additional restrictions. Automated card testing bots can also strain network resources, causing legitimate customer transactions to fail.

The Role of Bots and Automation in Modern Card Testing Attacks

Modern card testing fraud is rarely manual. Fraudsters increasingly rely on bots, scripts, and headless browsers to test stolen payment credentials at scale.

Automated attacks use botnets, rotating IP addresses, and proxy services to distribute transaction attempts and evade IP-based controls. Some tools mimic legitimate customer behavior by varying transaction timing, cart contents, and device characteristics.

Automation also allows fraudsters to respond quickly to defenses. Bots can adjust inputs when AVS or CVV mismatches occur, switch merchants instantly, or slow transaction velocity to avoid detection. These low-and-slow attacks can persist for extended periods before being noticed.

Because of this sophistication, traditional rule-based systems are often insufficient on their own. Merchants benefit from layered defenses such as behavioral analysis, device fingerprinting, and bot mitigation tools, combined with adaptive velocity rules.

How Do You Stop Card Testing Fraud?

A few adjustments to internal procedures can significantly reduce exposure to card testing fraud. Key prevention methods include AVS and CVV matching, velocity controls, and transaction monitoring.

Many large-scale card theft methods do not provide complete payment credentials. Enforcing AVS and CVV checks blocks a meaningful percentage of card testing attempts. Merchants should also ensure that authorization decline messages do not reveal information that could aid fraudsters.

If fraudsters understand why declines occur, they can more easily adapt their attacks.

These checks alone will not stop all card testing fraud. Fraudsters may attempt multiple CVV guesses using automation, but issuer and gateway controls typically limit retries. Blocking cards or devices after a small number of failed attempts remains an effective safeguard.

Additional credential theft methods, such as phishing and e-skimming attacks, can provide fraudsters with complete card data. Educating employees and maintaining a secure checkout environment helps reduce risk, but merchants must still prevent stolen credentials from being used on their websites.

Practical Strategies for Preventing Card Testing Attacks

Monitor transaction activity closely. Multiple small purchases in a short time frame—across one card or many cards—are a common indicator of card testing fraud.

Monitor IP addresses carefully. Card testing traffic often comes from anonymized sources such as VPNs and proxy services rather than clearly identifiable locations. IP analysis is most effective when combined with other fraud signals.

Blacklist known bad actors. Fraudsters frequently re-target merchants they’ve successfully victimized, especially if vulnerabilities remain unaddressed. When uncertainty exists, merchants may attempt manual order verification, though this approach is not scalable.

What Tools Should Merchants Use to Prevent Card Testing Fraud?

A PCI-compliant payment gateway is the first line of defense against card testing fraud and other forms of e-commerce fraud. This should include AVS and CVV enforcement and configurable fraud rules.

Merchants should also consider tools that provide real-time transaction monitoring and adaptive risk scoring. These solutions evaluate multiple data points—such as device fingerprints, behavioral patterns, transaction velocity, and historical performance—to assess risk dynamically rather than relying solely on static rules.

By continuously adjusting thresholds based on observed activity, adaptive fraud tools can identify card testing fraud earlier and reduce false positives that would otherwise disrupt legitimate customer transactions.

Analyzing and Preventing Fraud Chargebacks

Analyzing chargeback data is one of the most effective ways to assess card testing fraud prevention efforts. Successfully blocking card testing early typically results in fewer low-dollar fraud chargebacks.

Because card testing fraud can generate large volumes of activity in short periods, it poses a serious risk to chargeback ratios and merchant account stability.

Chargeback management companies can help identify card testing patterns, optimize fraud controls, and recommend appropriate gateway configurations for a merchant’s specific environment.