Security & Fraud

Offering Convenience Without Sacrificing Security

Seamless movement across connected and mobile devices, from checking a bank account balance on a smartwatch to shopping via a social platform, creates simplified and convenient experiences that customers crave.

But conducting business on connected devices is also creating new security gaps for fraudsters and other bad actors to exploit, wreaking havoc on customers and companies alike.

Cybercrime has flourished as the internet and mobile devices have given consumers greater online capabilities. Credit reporting agency Equifax is just one of the many companies to have suffered through a recent data breach, as the company disclosed an incident impacting an estimated 148 million customers. The company exposed consumers’ full names, birthdates, addresses, Social Security numbers and even some 250,000 credit card account numbers.

Equifax has not been alone, of course. Fraudsters also attacked Verizon Wireless, accessing the personal data of more than 14 million customers. And Uber, which disclosed in November 2017 that hackers had stolen nearly 60 million riders’ and drivers’ information. Even political parties were within fraudsters’ reach, as a Republican National Committee breach exposed roughly 200 million people’s voting data.

Add it all up and in 2017 alone, cybercriminals stole more than $1.4 billion via more than 300,000 reported cyberattacks that year, according to the Federal Bureau of Investigation’s “2017 Internet Crime Report.” The problem has been forcing banks and merchants to seek out improved security and authentication capabilities to protect their customers.

But while consumers are concerned about security, and expect it to be a top concern for banks, they are seemingly not prepared to sacrifice simplicity and speed for safety.

According to one recent study, roughly 50 percent of consumers say they have abandoned a digital cart after being confronted with a CAPTCHA sequence. The same study found that 28 percent of consumers gave up on online orders because the checkout processes were “too long/complicated,” and a significant portion did so because the site required them to enter too much personal information or to create an account to complete a transaction.

As PYMNTS explores in the inaugural Omni Security and Authentication Report, this puts increased pressure on banks and other financial institutions to offer convenient yet secure experiences to customers.

Many banks, including Royal Bank of Canada, are turning to customer data and emerging technologies to tackle these challenges. As Martin Wildberger, executive vice president of innovation and technology at RBC, pointed out in a recent interview, the best strategy in the fight against fraud is likely one that incorporates emerging technologies and is driven by data on both customers’ and fraudsters’ habits.

Download the inaugural Omni Security and Authentication Report to read the interview with Wildberger, along with the latest security headlines.

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Latest Insights: 

Our data and analytics team has developed a number of creative methodologies and frameworks that measure and benchmark the innovation that’s reshaping the payments and commerce ecosystem. The July 2019 AML/KYC Tracker provides an in-depth examination of current efforts to stop money laundering, fight fraud and improve customer identity authentication in the financial services space.

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