Biometrics and tokenization: the dynamic duo against bank fraud
This is a guest post by Greynier Fuentes, VP Digital Solutions at VeriTran.
There is an increasing trend over the last several years in technology becoming the main channel for how we interact with our surroundings. However, just as it has opened the door to easiness and comfort in our lives, it has also increased the risk of data theft and computer fraud for companies. This translates into expensive and destructive consequences that can generate loss of credibility and damage to the reputation of institutions, as well as a significant financial impact as a result of the data breach that occurs in each cybercrime.
According to Arkose Labs, online fraud in the US increased by 20% during the first quarter of 2020, in comparison to the previous year. Giving the current COVID-19 restrictions across the world, the use of digital transactions has surged significantly accounting for this increase. In line with the firm’s data, the United States emerged as the top originator of cyberattacks, with a spike of 20% in cyber fraud incidents in comparison to other well-developed countries.
Security in the digital world remains vulnerable. Password protection does not provide a high level of security in this day and age, and it is imperative that we seek new data protection methods that reduce the risks that customers experience when sharing personal information with their banks.
Although there is no mechanism that guarantees 100% reduction in the risk of cybercrime, it has been proven that the proliferation of computer security mechanisms can increase the chances of fighting these situations. For example, a combination of biometrics and tokenization is one of the solutions that continues to gain popularity in the computer security market. Such solutions give the companies an ability to offer their clients greater security and confidence in the development of their daily transactions.
A dynamic duo of bank security
Biometric systems are a set of digital technologies that use people’s physical features as a way of authentication.
Tokenization is the mechanism in which the most sensitive data and information of a card holder is replaced by a random token that will constantly change whenever the user initiates a transaction.
In the past, banks asked their customers for a password and / or card number before starting a transaction. Recently, these authentication processes have been increasingly violated. Due to this, financial institutions are facing the challenge of implementing new security resources that use technological advances to integrate innovation into their processes. Security resources such as facial, voice or fingerprint recognition systems, combined with an additional identification factor such as tokenization, are ultimately increasing the security of bank transactions.
It is unrealistic to claim that these solutions would bring an end to cyber-crimes. However, the evolution of technologies such as the ones described above, and the ability to combine them together, increases the level of trust and tranquility that banking companies can offer to their clients in an era where digital processes have taken full prominence in human life.
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