How do I strike the right balance between convenience and security?
The long-contemplated question held by many payment service providers is ‘how do I strike the right balance between convenience and security?’. While I have discussed this in previous blogs, the topic has become even more prominent with new research revealing that consumers want merchants to increase security measures, with many stating they would accept ‘any measures necessary’.
So are there such things as effective and convenient fraud prevention methods? How do I strike the right balance? Here I discuss why it’s time to move on from traditional methods.
Assessing the options
Sharp advancement in technology means that we now have an abundance of options when it comes to fraud prevention – some admittedly more robust than others – yet traditional methods such as proof of address checks (usually requiring a scan of a utility bill or recent bank statement) remain the most popular.
While convenience consciously matters less than security does to most consumers, it is still important to factor in that friction can (and does) cause drop-offs. The good news is that highly effective fraud prevention methods which reduce this friction do exist.
With over a third of merchants only reviewing their fraud prevention once a year or less – and with fraudsters continually finding new ways to get around verification checks – it’s easy to fall behind more advanced competitors and either lose customers because of the this, or lose money to fraud.
The future of fraud detection
It’s time that merchants took a step forward and embraced these new innovations, addressing the concern of fraud while minimising friction in the user journey.
One way to do this is by leveraging consumer’s social and digital data through a consent-based social connect option within the registration/login/sign-up process. This adds far less friction than asking for a copy of a utility bill, and less than two-factor authentication, but is highly effective. By accessing a wealth of data and analysing both breadth and depth to corroborate identity, you can verify an individual within seconds of connecting.
Source: Finance Digest