Nov 2018 | Fraud detection | Fraud Prevention

Our video talks about how banks can improve fraud controls to protect consumers.

It covers the importance of strong authentication, and the value of monitoring and mitigating risks, whilst keeping the customer at the forefront.
It explorers the various impacts from challenger banks, processes affecting the customer and potential cyber-attacks.

The experience with fraud increases within the retail banking market has been quite considerable. If you actually look at some of the fraud stats currently that have been experienced where about 4 ½ % nearly 5% of individuals have experienced either with a credit card or with a bank accounting some form of fraudulent action.

It is actually shown amongst a number of our C-fast members where the increase in fraud has been over 16% over the course of the last year. So really for the banks it is extremely important in terms of protecting their customer against fraud and it is their number one area in terms of ensuring they have actually got very clear understanding of who their customer is transacting with.
So it is one of the areas the bank is very much focussing on to see what can they really understand as to how best to manage their customers, because clearly there is a very strong level of reputational risk that is important and certainly mitigate any of the risk factors where they could start to lose that reputation and the value of their customer service to those customers. The retail banking sector is very competitive a lot of new companies are coming into the market, particularly with the new challenge of banks and that means banks really need to improve their processes but making sure they are clearly protecting their customer.

So they are looking at ways of doing that and they have various strong authentication processes at the moment but some of those are not as strong as they feel they should be. It doesn’t necessarily pick up small transactional volumes or anomalies and really where the depth of capability that the banks really need to know at the moment is where they are trying to establish what sort of exposure there have been to transactions on the account, who are the potential cyber-attacks and where they may be coming from and what experience they are seeing across their current account book, what they are seeing around the transactions, what they are seeing in terms of the customers behaviours and then in turn managing their risk and that becomes absolutely crucial so both aligning themselves in terms of the risk exposure and in terms of the business rules sitting behind that.

With the Industry now the very much more strength of capability around knowledge base authentication, looking at questioning around an individual’s credit performance and credit exposure so its only data that they know not data that is known by other people and that provides a much stronger proof of authentication.

It can also be linked around some areas, particularly around account ownership, so certainly where you see transactions on a bank account where a new account of payees have been set up then what monitoring is taking place when those accounts are being set to new bank accounts, are you able to link the ownership of the account and are you going to be able to identify it is the person you believe that you are actually transacting with.

So I think overall it is very clearly a challenging market place for the banks. I think you have a number of systems and processes in place to improve the customer service but clearly making sure that the consumer is very much at the forefront of the customers mind.