Customers want and need to be protected against fraud, but they also expect a fast, easy experience every time they interact with you. Find out how you can achieve this with our five top tips for boosting your fraud protection without negatively impacting your customers.
In highly competitive and low-growth markets, anything that negatively impacts the customer experience is damaging to your business. Experian research has found that 35% of customers abandon online applications due to friction, while seven out of ten businesses struggle to authenticate customers without impacting their experience. So how can you effectively protect your business and your customers against the rising threat of fraud without making their interactions slower or frustrating?
The good news is that implementing effective fraud solutions without causing friction in your customer journeys is easier than you think. Here are five steps you can take to tackle fraud from all angles, while keeping things fast and easy for your customers.
1.Use data that fraudsters can’t get their hands on
Unfortunately, a wealth of data about your customers is available in the public domain – on social networking sites and elsewhere. In addition, cybercriminals may have access to stolen data about your customers that can be used to steal their identities or commit other kinds of fraud such as personalised phishing.
The good news is that you can help to identify and authenticate customers using data from your own organisational systems, including details of recent transactions, customers’ buying preferences or device recognition. Because fraudsters don’t have access to this data, you can increase trust in your customer identities, authenticate them without onerous questions and checks, and generally remove friction from their interactions with you.
2.Think of compliance as a force for good
For many organisations, compliance is all about ticking boxes. However, a much more beneficial approach is to think about what compliance can do for your business and your customers rather than what you have to do to become compliant.
By taking this approach, you can use compliance guidelines to start cleaning, managing and stewarding your data more effectively. This will help you to identify and authenticate customers much more easily to streamline customer journeys, while also reducing your fraud risks. For example, PSD2 may have many moving parts but ultimately, once compliant, it can only benefit an organisation as the architecture supports faster and frictionless payments which in turn provides better customer outcomes.
3.Be proactive about implementing new technologies
Experian research shows that many organisations are quite conservative when it comes to adopting new technologies to authenticate, verify or detect fraud, with only 35% of companies planning to become fraud prevention ‘leaders’.
The best way to evolve your fraud prevention environment and adapt quickly to new fraud threats is to be proactive about adopting new fraud technologies. Specifically, making the decision to implement a centralised, multi-layered fraud prevention platform can help you tap into new, more advanced fraud tools as the risk landscape evolves – while minimising friction for your customer at the same time. Machine learning and advanced analytics can spot anomalies and trends amongst large data sets which may have gone undetected if manually reviewed. Another benefit to machine learning in the fight against fraud is that it can adapt over time to new, previously unseen fraudulent activity.
4. Avoid creating new data silos
All IT systems were modern once, but most now often create barriers to effective fraud prevention, not to mention imposing friction for your genuine customers. To avoid history repeating itself, invest in fraud solutions that bring multiple systems together and fully integrate with all operational areas of your business.
By integrating systems and processes across your business in this way, you can achieve a group-wide view of potential fraud threats, respond to fraudulent activity faster, gain a single view of the customer and stay agile in the face of evolving fraud threats. Best of all, you’ll be able to deliver frictionless experiences for your customers as they interact with different areas of your business via different channels.
5.Remember that the right amount of friction is actually a good thing!
Some friction in the customer journey is OK, and even desirable (for some transactions). If a customer is applying for a mortgage, for example, they want to feel reassured that their data and money is safe – so they’re willing to go through a couple of extra security checks.
This phenomenon of elastic friction comes up in the Experian 2018 Global Fraud and Identity Report, which found that 66% of people “like all the security protocols when I act online because it makes me feel protected.” Just remember that when it comes to frictionless fraud prevention, it’s a case of getting the security and friction levels right – meaning that one size never fits all.
Experian are experts in helping organisations maximise fraud protection, while reducing friction in customer journeys. Our open-standards-based, multi-layered fraud platform helps businesses to create a single customer view to speed up identity and authentication and minimise fraud risks.
To find out how Experian can help you deliver frictionless fraud protection for your customers, please view our frictionless fraud prevention paper, watch our webinar on frictionless fraud, or email us at gtmcontactus@experian.com.
