Survery finds 72% of financial institutions fear account takeover fraud

Survery finds 72% of financial institutions fear account takeover fraud

BioCatch, a global leader in behavioral biometrics, has announced the release of 2021 Fraud Transformation Survey: Detecting and Preventing Emerging Schemes a study independently conducted and prepared by Information Security Media Group. Based on a global survey of financial institutions, the report reveals the fraud threats creating the most concern and financial impact, the changing role of fraud management within organizations, and the business challenges driving investment in new fraud prevention technologies.

Some of the key highlights of the report include:

  • 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.

Download the full report.

BioCatch hits PSD2 milestone

BioCatch hits PSD2 milestone

BioCatch, a leader in behavioural biometrics, announced it has entered the implementation stage of its offering that will enable financial institutions to leverage BioCatch’s behavioural biometric-based solution to support their journey to compliance with PSD2’s implementation of Strong Customer Authentication (SCA), a regulation that requires multi-factor authentication for online transactions.

BioCatch’s behavioural biometrics industry best-practices solution improves banks and financial institutions’ customer experience by applying machine learning to provide superior consumer protection while reducing friction in the digital journey.

BioCatch will provide behavioural biometric technology through integration partners who offer access control solutions to customers leveraging SCA and online fraud prevention services. This will enable financial institutions to use behaviour as a factor in their SCA compliance to facilitate their ability to meet the new March 2022 U.K. timeline for SCA compliance. BioCatch has begun behavioural biometric-based customer interface implementations for SCA for several customers.

“Since it operates in the background, behavioural biometrics enables a secure, customer-centric experience by analyzing a user’s digital behaviour without increasing friction,” said Howard Edelstein, Chairman & CEO of BioCatch.

By leveraging behavioural biometrics as a factor for SCA compliance, banks can reduce a tremendous amount of friction, improving the user experience, reducing attrition in the payment process, all while reducing authentication costs.

BioCatch’s category-defining behavioural biometrics technology protects many of the world’s largest financial institutions, their clients and their clients’ assets from fraud and other types of criminal activity.

“This is very exciting news, and excellent timing.” said Neira Jones, independent advisor and a pioneer in the payments security industry. “The ICO clarification around consent for behavioural biometrics to support SCA compliance and its deadline extension to 2022 gives financial institutions an opportunity to not only focus on compliance, but also prioritize reducing friction to improve the customer experience as part of a holistic payment fraud management strategy.”

To better help card issuers and ecommerce organizations with SCA Compliance, BioCatch is hosting a LinkedIn Live Discussion Series to help broaden the industry’s understanding of its SCA compliance journey.

The first event, The Benefits of Behaviour for E-commerce SCA Compliance, will be held on Wednesday, July 28 at 3:00 p.m. U.K. time (10 a.m. ET) and will feature two BioCatch leaders: Iain Swaine, Head of Cyber Strategy EMEA, and Ruhan Basson, Director of Pre-sales & Professional Services for EMEA. They will dive into the recent ICO decision and the advantages of using benefits of using behavioural authentication in achieving PSD2 SCA compliance. Participants can register here.