Balance between security and user experience reported top fraud prevention challenge for businesses
Striking a balance between preventing fraud and creating friction for customers is the single biggest fraud prevention challenge for businesses, according to a new survey from IDology.
The Sixth Annual Fraud Report from IDology shows mobile fraud grew by 117 percent from 2017 to 2018, with mobile device attacks and phishing surging in prevalence, while account takeovers are considered prevalent by 49 percent of business respondents.
Among the perspectives provided in the report, 85 percent of businesses consider identity verification a strategic differentiator, due to increases in fraud, competition, and consumer expectations. Identity verification has also become more complicated in the last three years for 75 percent of respondents. Impactful new trends in identity verification noted by businesses include utilization of mobile device attributes, artificial intelligence, machine learning, and mobile document capture.
“The prevailing mindset that in order to keep fraud out, the customer verification process has to be made more difficult is quickly becoming outdated,” said John Dancu, CEO of IDology. “In our modern connected world, it’s no surprise that fraud is on the rise and becoming more sophisticated. Winning businesses will be the ones that take a strategic approach to identity verification with the realization that they can offer frictionless customer convenience and effective fraud deterrence to ultimately cultivate customer trust.”
“We are at a crossroads where the movement to mobile meets high consumer expectations and sophisticated fraud schemes,” said Julie Conroy, research director for Aite Group’s Retail Banking & Payments practice. “Identity verification is now something that businesses must consider as a key strategic factor for market differentiation and growth. A seamless, comprehensive and multi-layered approach with an anti-fraud consortium network of companies across industries is now table stakes.”
IDology reported survey results earlier this year indicating that biometrics are considered secure by more consumers than other methods of digital identification, and that identity verification methods have become a factor in choosing between competitors.