Financial institutions turn identity signals into continuous trust

Financial institutions are increasingly treating onboarding, authentication, fraud detection and payments as parts of a single identity lifecycle. Rather than making decisions based only on a login or transaction, they are using behavioral, device and digital identity signals collected throughout the customer relationship to continuously assess trust.

And new research suggests that FIs must make use of those signals, as consumers are willing to switch financial institutions if they run into poor authentication experiences.

Nearly half (43 percent) of U.S. consumers surveyed by Entersekt said they would be willing to switch their financial institution based solely on the experience their authentication method delivers. Even more people say their financial institution still uses SMS one-time passwords (OTPs), but less then half of them (18.2 percent) believe that is the most secure method of authentication.

Entersekt’s report on “The state of digital banking security” shows 50 percent now trust biometrics, but points out that layers from device signals to behavior analysis are necessary to protect against AI spoofs.

Experian similarly found organizations increasingly rely on AI-driven fraud detection fueled by identity, behavioral and device signals collected throughout the customer journey. Half of U.S. consumers told the company they trust organizations more when they can recognize returning users without repeated authentication challenges.

Identity lifecycles and transaction workflows include discrete points of decision-making, but the data that goes into those decisions is increasingly coming from other points in time.

Remote onboarding

Credolab’s behavioral risk scoring, fraud detection and alternative credit intelligence capabilities based on signals from device and behavioral metadata analysis are now available from the FICO Marketplace.

FICO clients can use Credolab’s behavioral intelligence, selected from the Marketplace’s Data & Intelligence and Fraud & Threat Intelligence categories within workflows to expand financial inclusion, improve risk separation and reduce credit losses, according to the partnership announcement. Real-time risk and intent signals and orthogonal behavioral features make the software effective at filtering out the bots, device farms and synthetic identities that define the contemporary threat landscape during onboarding.

“Behavioural risk intelligence is quickly becoming its own category in credit decisioning, distinct from fraud detection, complementary to traditional and transaction scores, and we’ve built our entire platform around it,” says Credolab Co-founder and Chief Strategy Officer Michele Tucci.

Fraud investigation

The new investigative intelligence platform from Fideo Intelligence brings together and correlates fragmented identity signals. Fideo Lens is intended to compliment existing investigative technologies to help fraud teams in financial services find hidden connections between identities, accounts, devices and behaviors and visualize them to speed up analyst responses.

“Fraud and financial crime rarely exist as isolated events anymore; they play out across networks of connected identities, devices, and organizations,” notes Chris Harrison, CEO of Fideo Intelligence in the announcement.

Investigative, fraud risk and AML teams get interactive relationship mapping and broad identity intelligence from Fideo’s Identity Fraud Intelligence Network (iFIN), which can help distinguish between identities and identify potential aliases.

Payments

Belgian payments company Bancontact, which dominates its home market, has integrated the new Anti-Fraud Intelligence platform from Telesign.

The partnership brings real-time risk insights and fraud intelligence to the Bancontact Pay app for greater security against payment fraud.

The API-based solution applied behavioral analysis, domain-level and digital identity insights and risk scoring to provide the payment platform with instant recommendations.

For financial service providers attempting to differentiate themselves in a competitive environment where AI-powered fraud is making consumers and businesses nervous, making use of signals from throughout the lifecycle to inform each access or fraud risk decision is an emerging opportunity.

Article Topics

behavioral biometrics  |  biometrics  |  continuous verification  |  Credolab  |  device fingerprinting  |  Entersekt  |  Experian  |  Fideo Intelligence  |  financial services  |  onboarding  |  TeleSign