In e-commerce, blacklisting is used to prevent fraud. A given blacklist includes data from customers who have proved to be unreliable in the past. This enables online retailers to exclude disreputable or suspicious customers and prevent fraud before incurring any loss.

A blacklist is automatically checked against during transaction processing. If the buyer’s data is on the blacklist, the transaction is rejected.

Blacklists record all information from individuals who have been flagged as untrustworthy in the past. To prevent fraudulent transactions in e-commerce, the buyer’s name, transaction data, bank data, IP addresses, and email addresses may be listed. For example, if a buyer defaults on one or more purchases, their data is immediately placed on the blacklist. This protects retailers against further fraudulent activity.