CFIT forms coalition to combat economic crime through enhanced verification methods

The Centre for Finance, Innovation, and Technology (CFIT) is forming a new coalition aimed at combating economic crime through enhanced verification methods. By gathering experts from an array of industries including finance, technology, policy, and academia, CFIT plans to develop solutions for detecting fraud, protecting small and medium-sized enterprises (SMEs), and strengthening defenses against crimes such as Authorized Push Payment (APP) fraud.

CFIT’s coalition will include digital ID providers, technology companies, trade associations, large and challenger banks, fintech firms, and credit agencies. The full list of partners is not yet disclosed. These participants will collaborate on data-driven research to verify the legitimacy and identity of businesses engaging with financial services, the company notes.

They will also address other security challenges in commerce and payments affecting UK businesses and consumers. The goal, according to CFIT, is to show how tackling financial crime can protect businesses and their customers while enabling banks and fintech firms to reduce liability, save costs, and improve customer experiences.

The coalition’s initial concepts are currently being tested with Citizens Advice and several retail banks, following a proof of concept with HSBC. The coalition will begin its activities immediately, with interim findings expected in Q4 2024 and a final report in early 2025.

CFIT’s CEO, Ezechi Britton MBE, emphasizes the importance of this initiative: “Economic crime is a major threat to the UK’s financial security, and it can have a profoundly distressing impact on consumers and businesses.

“At CFIT, we are committed to addressing this and making the financial services industry more robust by uniting the best minds across the sector and beyond to combat this pressing issue. This will be achieved through verifying UK businesses to fight economic crime. Our intention is to support the incoming Government and industry to put in place measures that will make financial services safer, and our economy even more resilient in the years to come.”

This initiative is off the back of CFIT’s previous coalition on Open Finance, which showcased the potential of data-sharing technology to enhance financial outcomes for UK consumers and provide better access to finance for SMEs.

Martin McTague, national chair of the Federation of Small Businesses, highlights the impact on small businesses: “Fraud exacts a huge toll on small businesses, and every effort must be made to tackle it so that customers can shop safely online and small firms can trade securely.

“Any proposed solution to fraud must take the needs of small businesses into account, in terms of how it can best protect them, and in terms of considering how to make it as simple as possible for them to integrate into their processes.”

Juniper Research estimates that cumulative merchant losses to online fraud globally between 2023 and 2027 are estimated to exceed $343 billion.

Article Topics

Centre for Finance Innovation and Technology (CFIT)  |  digital identity  |  financial crime  |  financial services  |  fraud prevention  |  identity verification  |  KYC  |  UK