Account takeover cited as the fraud threat causing the most concern among 72% of global financial institutions surveyed. Other top fraud threats cited include phishing, synthetic ID fraud and social engineering scams. These threats are also the same ones identified by respondents as having the most financial impact over the last year.
1 in 2 financial institutions cite loss of productivity as the biggest non-financial impact of fraud.
47% of responders state lack of visibility into risks introduced by new digital technologies as a top fraud management challenge.
2 out of 3 of financial institutions expect to increase their investment in anti-fraud resources.
“While the industry has made great strides in protecting consumers from cybercrime, the risk of fraud continues to take a heavy toll on financial institutions and the clients they serve,” said Raj Dasgupta, Director of Fraud Strategy at BioCatch. “There is still much more work to be done to combat account takeover and other forms of fraud, and the study confirms the industry has placed behavioral biometrics at the forefront of investment in the coming year.”
The report also revealed customer experience is becoming as equally important to financial institutions as managing the bottom line from fraud losses. Among financial institutions surveyed, 62 percent cited making customers feel secure as a top priority for investing in fraud prevention technology. This highlights the changing role of fraud management within financial institutions and its evolution to a business issue that involves multiple stakeholders with one in two financial institutions noting digital channel business leaders as a top influencer in fraud management decisions.
Two out of three financial institutions expect an increased investment in fraud management resources with behavioral biometrics and analytics, transaction analysis and monitoring, and device ID and intelligence cited as the top three fraud prevention technologies slated for investment over the next 18 months.
The survey polled fraud and cyber security professionals at more than 175 financial institutions across the globe. All regions were featured with half of respondents from the U.S. and Canada, 18 percent from the UK and Europe and 14 percent from Latin America. The survey was conducted between July 1 and August 20, 2021.
Feedzai, a leading cloud-based financial risk management platform, announced the acquisition of the most advanced behavioral biometric platform, Revelock. Following a $200m investment round earlier this year, Feedzai’s acquisition creates the world’s largest AI-powered financial risk management platform with native, integrated behavioral biometrics. The integrated platform enables financial institutions and merchants across the globe to detect and prevent financial crime before it occurs. Hypergranular risk-level assessment bolsters security, maintains privacy, and gives consumers a lightning-fast experience.
The transformational combination of Feedzai and Revelock will create the world’s largest Financial Intelligence Network (FIN), a vault of more than a trillion data points, sessions, and profiles of both good and bad actors. Feedzai Segment of One Profiling uses 150B data points to decide if the transaction is fraud or not. To top this, Revelock brings biometric intelligence from every user, device, and session connecting to the system. Beyond the addition of behavioral biometric data to its platform, Feedzai leverages AI and machine learning expertise to use enriched information in models to create predictive intelligence to stop financial crime in real-time. Feedzai provides end-to-end management of data quality, governance, and usage; keeping every user session anonymous to ensure people are treated as people and not as data points. Other fraud solutions simply add biometric data without usage guidance, creating manual work for data science teams.
Over the past year, ATM withdrawals are down 58 percent in the U.S. (Feedzai), 41 percent of consumers switched from cash to online/phone payments, while 55 percent do not plan to switch back to cash (Zelle). The early days of the pandemic forced many businesses, both small and large, to move to contactless, digital payments to reduce the possibility of exposure to COVID-19, accelerating cashless commerce. Many consumers moved to online banking and commerce, adding convenience, but offering criminals more opportunities to commit financial crimes and increasing the burden of risk to banks, payments processors, acquirers, and merchants.
As the digital economy evolves from barter to crypto, Feedzai recognizes that security is crucial to modern commerce, providing consumers with peace of mind when transacting online, and lowering the risk for financial institutions and merchants.
“Our goal has always been to make digital commerce safe for everyone. Adding Revelock to our clients’ arsenal changes the paradigm from securing transactions in real-time – something we were already doing – to effectively preventing crime before it happens,” said Nuno Sebastiao, CEO of Feedzai. “More than 20 percent of the world’s money flows through Feedzai, and we secure the bank accounts of 1 in every five people. We already knew what transactions took place for more than 800 million consumers. Revelock adds the intelligence of how a transaction takes place. Combined with the why from using Feedzai’s Responsible AI, we’re moving to the next level of machine precognition. As a result, our client’s customers have a safe pass throughout their entire digital commerce journey, making their experience faster, more private, and more secure.”
Revelock technology enhances Feedzai’s platform capabilities by providing a robust digital identity solution using state-of-the-art behavioral analytics powered by deep learning. Other digital identity providers focus just on behavioral biometrics, device assessment, phishing, or endpoint malware detection. Feedzai offers comprehensive global intelligence, natively integrated into the platform in a single solution. This critical addition to the Feedzai platform makes it the first end-to-end risk management platform for prevention, detection, remediation, and compliance that will improve the user experience while minimizing the burden on anti-fraud and anti-money laundering (AML) teams.
“We created Revelock to help commerce enablers identify whether you are really you when you’re transacting online,” said Pablo de la Riva, CEO of Revelock. “With its hypergranular, anonymized profiles, Revelock’s technology is capable of detecting the subtle changes in user behavior – such as differences in how you hold your phone or how quickly you navigate a banking app – and predict with confidence whether a session should or shouldn’t be trusted. It can identify bad intentions even from a single keystroke and stop fraud before it occurs, all while safeguarding your privacy and anonymity, even from the people that are protecting you. We are thrilled to see our technology come to its full market potential when fused with Feedzai’s AI expertise, where the combination of our technologies is pushing the boundaries of what can be done to secure modern commerce.”
Through this acquisition, banks, payment processors, acquirers, and merchants can gain better insight into their customers and their transactional behaviors to make more accurate risk decisions, faster, protecting customers from cyber threats such as malware, phishing, and account takeover attempts. Feedzai manages the entire process, from login to checkout, automatically handling biometric and transactional data without adding any manual work for data science teams.