Why are Businesses More under the Risk of Identity Theft?
Gone are the days when businesspersons had to care only about developing their businesses and making profit to run their businesses successfully. Today businesses also face a serious crime – the crime of identity theft. As such, everyone is under the risk of identity theft. However, businesses are more prone to this risk. Why? Let’s see.
Bigger Bank Balances
Unlike individuals, businesses have to maintain bigger amounts in their bank accounts so as to make transactions conveniently. An average business maintains at least $5,000 to $10,000 or even more in their bank accounts at any given time. If it’s a larger business, it may have tens and even hundreds of thousands of dollars in its account. As compared to an individual consumer who has somewhere around $500 to $1500 in her/his account, a business account is any time more lucrative and tempting for identity thieves.
Ease of Opening Account and Credit
As the expenditure of businesses is more, they are eager to open a new account. In most cases, opening a new account for a business is much easier than opening one for an individual person. An individual person may need to be approved via a credit check and has a $500 credit limit, while a $1000 or more credit limit is granted automatically, just for opening a new account for a business.
Flexibility in Payment Terms
Because businesses make larger purchases, they enjoy flexibility in payment terms which enable them to get products or services they order and pay afterward within a stipulated timeframe, usually within 10 to 30 days of the date of invoice. This provides business identity thieves a clean way to order and get goods and services on the name of a business and as a bonus, they are also able to skip early detection that arises after using a stolen credit card or check for payment at the time of order.
Upper Credit Limits
As businesses are expected to spend more than an individual customer, they are offered higher credit limits. While an individual consumer of a bank may get a credit limit of around $1000 to $5000, a business gets a credit limit of $25,000 to $100,000 or even more. To add to this, several businesses offer the facility of employee cards which are linked to the main credit account of the business. Any of these employee cards can be compromised without a careful review, process of expense approval or transaction limits, and deceitful transactions can easily take place without timely detection.
In such a scenario, businesses should be extremely careful to protect their business falling prey to identity thieves. Taking help of an identity protection service is advisable in such a situation. Read their reviews and decide getting their services for the protection of your business’s identity.