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Fraud is a booming business and it was revealed last year that fraud could be costing the UK economy a shocking £193 billion per annum. The financial sector is a clear target for cyber criminals wanting to get their hands on valuable customer data and they’re getting pretty good at it too. British financial institutions have been investigated 585 times for data privacy breaches in the past 12 months, a staggering rise of 183% on the previous year.
With data breaches and incidents of fraud continuing to hit the headlines on a regular basis, consumers are becoming increasingly aware and concerned about the safety of their financial data. Six million people in the UK have fallen victim to financial fraudsters and a further third of Brits say they are worried that they could become a victim of financial fraud at any time.
As hackers continue to hone their skills to gain access to people’s bank accounts, banks, must take more seriously the need to protect their customers and in the act of doing so, their own reputation.
Protecting data with data
Data is invaluable in the fight against fraud. And luckily for banks, they are in a unique position as they have access to extremely insightful data such as a person’s spending habits and location information. By analysing this data, banks can develop and record ‘normal’ customer behaviour patterns. This means that anything out of the ordinary can be quickly and easily identified – such as a transaction in another country when only minutes/hours before, a consumer was seen to be using a bank card in the UK. Once identified, a bank can send simple, automated fraud alerts to the customer via SMS, email or a push notification in real time, detailing the transaction and asking them to verify whether or not it was made by them.
If a customer has not replied in, say 60 minutes, the issue can be escalated with the bank contacting the customer via their mobile phone to verify the transaction. This two way communication between bank and consumer ensures customers can purchase the goods and services they want quickly, but securely.
Using data in this way not only has a huge impact on fraud prevention, it also establishes trust and loyalty, as customers can see for themselves their bank’s active efforts to keep them safe.
No silver bullet
It would be virtually impossible for any bank to ever be 100% secure; cyber-attacks, especially in the financial industry, are now part and parcel of everyday life. It’s no longer a question of ‘if’ a bank be targeted by cybercriminals, it’s ‘when’. But as attacks become more targeted and sophisticated, the case for using customer data to fight back, deploying a cross-channel communications strategy to mitigate fraud, becomes so much stronger.
Today, having a complete 360 degree view of your customers has never been more important. Having access to this insight, and the ability to act on it quickly, plays a pivotal role in verifying the identity of a customer and the transactions they make on a daily basis.
To read more, download our whitepaper ‘Mobile Banking: The Vital Role of Cross-Channel Communications in 2017’ today.