Page 91 - Security Today, July/August 2019

Security is Crucial
Another key finding from the Second Annu- al Consumer Digital Identity Study is that consumer’s value security over speed during account sign-up. Eighty-eight percent of online consumers said they highly valued a secure account opening process compared to 57 percent who valued a quick process. However, when asked how they felt about additional verification and security checks that slowed down an account sign-up or high-risk transaction, 75 percent stated they were “strongly” or “very” opposed to the interruption.
As a result, businesses struggle to consoli- date two prevailing but conflicting mindsets: keeping fraud out by making verification harder and bringing in more customers by making transactions seamless.
Who is Responsible?
IDology’s Second Annual Consumer Digital Identity Study also found that the perception of who is responsible for protecting consum- er data is also changing, and perhaps for the better. Seventy-eight percent of consumers strongly believe it is a company’s responsi- bility to protect their personal information, increasing from 67 percent last year, while 68 percent of consumers strongly believed it is their responsibility, increasing from 59 percent last year. This translates to both consumers and businesses having a deeper sense of responsibility related to taking ac- tions to protect their own and their custom- ers’ information. For example, Two-Factor Authentication (2FA) is becoming more the standard for high-risk transactions and ac- count openings: In the last 12 months, more than half (53 percent) of consumers have been required to provide further proof of their identity when opening a new account or using an existing online account.
A recent poll conducted by IBM/Harris reported that 75 percent of U.S. consum- ers won’t do business with companies they don’t trust to protect their data. The IDol- ogy Consumer study echoes this trend, with more than two-thirds of consumers surveyed (71 percent) reporting that knowing more ad- vanced identity verification methods were be- ing used would positively affect their decision to do business with a financial institution. This is a dramatic 27 percent increase over last year, when only 56 percent of Americans felt the same way, and shows that companies need to prioritize protection efforts related to customer data—not only for increased loyal- ty, engagement and trust, but also to decrease the risk and costs related to fraud.
A New Approach to Identity Verification
Thinking about identity verification in a dif- ferent way, not just as a compliance check
but as a strategic differentiator, is key to pre- venting fraud and friction. Businesses also should consider:
Increasing trust and addressing consumer concerns help drive new business. The im- portance of trust has top-line implications, particularly in financial services, as identity verification becomes much more of a com- petitive differentiator and moves from the back office to the front lines.
To build trust, more secure data exchange is needed. By verifying identities using a multi-layered identity verification platform that accesses and correlates different sources of data—mobile, email and location attri- butes, to name a few—companies can shift to a more secure process, ensuring agile verifica- tion and a frictionless experience while also deterring fraud. Using dynamic, rather than static, data and correlating layers of identity attributes to create a holistic and accurate picture of a person’s identity deliver a more reliable predictor of risk and higher locate rates when verifying an identity.
Friction and prevention don’t have to be mutually exclusive. Instead of a balancing act, think about verification on a per-cus- tomer basis: What is the right amount of friction for this specific person and when is the right time to introduce it? A multi- layered identity verification solution that examines an assortment of attributes and can dynamically make decisions based on a variety of parameters is the most effective way to maintain strong security while also ensuring customers only experience friction when necessary. It also prepares organiza- tions for tomorrow’s consumer, economy and fraud trends.
Take advantage of collaboration to de- crease fraud and risk. By accessing a col- laborative consortium fraud network across multiple industries, supported by machine learning and a team of fraud analysts, busi- nesses can gain timely alerts and actionable insights to detect and deter fraud.
Keep a step ahead. Staying on top of trends, advances in technology and the dynamic ways that systems are being compromised by fraud- sters will again help to ensure trust.
These considerations along with a shift in thinking about identity verification as a strategic differentiator can help businesses bolster consumer trust in a new era of digital identities and prevent fraud and friction and drive revenue.
Christina Luttrell is the senior vice president of operations including prod- uct, client solutions and marketing at IDology.
1 IDology’s Sixth Annual Fraud Report, 2018
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