Recent research conducted by Callsign into consumers online behaviour and attitudes to fraud found that 48% of Singaporeans were most worried about the risk of fraud when logging into their bank. This demonstrates that despite the best efforts made by banks to protect their customers’ data, there is still a feeling of distrust, insecurity and caution when attempting to access financial services online.
The approach up to now has been for banks to provide layers of authentication, including one-time security codes, passwords, and security questions, to prove the identity of every customer. This puts the onus on the customer to prove they are who they say they are and adds additional complexity to accessing their own information and online services.
For banks and online retailers, proving the person logging on is the account holder is getting harder and harder – mostly because the processes to authenticate are outdated and susceptible to fraud like never before.
For example, there are vast troves of sensitive data stolen worldwide by criminals intent on making illegal financial gains. All this information, e.g. date of birth, identity number, addresses and more, can be used to defraud honest, law-abiding citizens and generate distrust.
Although great strides have been made in the introduction of advanced and sophisticated technologies to protect consumers and businesses against the onslaught of digital fraudsters, the fact is digital identity is broken and needs fixing.
Authenticating through passive technology
The solution to this huge issue is similar to how people are identified by their characteristics in the physical world, i.e. their face, voice, body language and the way they walk. Digital identity can be proven through software that passively collects multiple different data signals and behavioural data points without affecting the user experience.
Through utilizing artificial intelligence, machine learning and real-time data, an individual’s behavioural traits such as how they type or swipe their phone screen, or the angle they hold the phone, and their location all make up a unique profile. This allows the authentication of a person without the necessity of needing to know any sensitive and personal information about them.
By analyzing the thousands of data points across device, location and behaviour, the identity can be confirmed in real-time and confirm that users’ behaviours fit their normal pattern.
If they do, the digital journey continues in a frictionless way, but if the behaviour pattern doesn’t fit the norm or bots and malicious activity have potentially been identified, further authentication may be introduced. This allows consumers to get on with their digital lives while businesses improve customer engagement and productivity and reduce fraud risks.
Placing identity at the business core is the digital version of putting the customer first. This helps ensure smooth online experiences and transactions and secure, privacy-preserving experiences, and getting this right drives customer loyalty.
Passive data signals mean securing online transactions, reducing both digital fraud and friction in the user experience, all in a privacy-preserving manner. Unlike most approaches, which require constant surveillance, data is only collected at each transaction and is analyzed against previous behaviour, meaning the identity is authenticated without knowing who they are.
The more people move online, the more important this will become. Organizations that succeed digitally will be those that recognize identity is part of every online interaction coupled with a premier customer experience.
The days of banks relying on consumers to prove who they are by supplying sensitive information or jumping through digital hoops are long gone.
The overhaul of digital identity through the passive collection of data, gives the consumer greater peace of mind, and means banks can preserve the privacy of their customers. Customers can also take back ownership, control and protection of their personal information.
By Namrata Jolly, General Manager Asia Pacific, Callsign