What is Subscription Fraud Prevention?
What is Subscription Fraud Prevention?
Subscription fraud is a significant risk for physical product subscription businesses — particularly those offering high-value devices like consumer electronics, e-bikes, or medical equipment. A fraudulent subscription order results in a lost asset that may never be recovered.
Why physical product subscriptions are high risk
In a SaaS subscription, a fraudulent signup results in a lost recurring fee. In a physical product subscription, it results in a lost physical device — worth hundreds or thousands of euros. The low monthly entry price (€30–€60/month) makes fraudulent signups attractive when the asset value is ten to twenty times that.
How subscription fraud prevention works
- Identity verification — confirming the subscriber is who they claim to be at signup
- Credit checks — assessing financial risk before approving a subscription for high-value assets. circuly integrates with CRIF for real-time credit checks
- Address verification — confirming delivery address against identity documents
- Payment pre-authorisation — holding a deposit or pre-authorising the card before the first delivery
- Behavioural signals — unusual order patterns, multiple signups from the same IP or address
Read: Credit Checks and Fraud Prevention | Fraud Prevention for Product-as-a-Service Businesses
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