Either out of necessity or convenience, the adoption of digital banking has skyrocketed since early 2020 and much of this shift is expected to be permanent. A recent study from J.D. Power found that almost 60% of consumers planned to use both mobile and online banking options more than they had pre-pandemic. That’s good news for banks and credit unions as digital banking gives financial institutions (FIs) the opportunity to engage with consumers more frequently and via lower cost channels. However, there is still a large and growing fraud problem that FIs must tackle to protect their bottom line and to maintain consumer trust.
Today, banks spend upwards of $40B in fraud-related expenses, not including the cost to support fraud victims via customer service channels like call centers. Meanwhile, approximately 80% of mobile banking consumers are concerned about fraud.
Mobile banking fraud concerns
SOURCE: CORNERSTONE ADVISORS
Multi-factor authentication (MFA) helps reduce the risk of unauthorized access, but it can add unwelcome user friction and is not sufficient to thwart today’s savvy cybercrooks. The ultimate goal is fraud prevention with non-intrusive detection of suspicious activity using behavior and environmental analytics with automated real-time response. This approach protects consumers from credential stealing, improvisation and account takeover attacks with a seamless user experience while also:
- Curtailing fraud – by detecting and responding in real-time to user impersonation and manipulation cyberattacks.
- Reducing costs – through minimizing false alerts, fraudulent claims and actual fraud losses.
- Facilitating compliance – as it protects consumer privacy which is a core banking regulatory requirement.
- Improving security – by stopping would-be cybercrooks from taking over accounts and/or creating new fraudulent accounts.
- Protecting your brand and reputation – to build and maintain consumer trust by proactively keeping their identities and data secure.
Learn more about how Entrust Identity as a Service provides continuous authentication with automated real-time response to instantly identify and stop active threats including malware, phishing, RATs, and others.
*** This is a Security Bloggers Network syndicated blog from Entrust Blog authored by Jenn Markey. Read the original post at: https://www.entrust.com/blog/2021/09/fighting-digital-bankings-fraud-problem/