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Building Trust in the Digital Economy Today & Tomorrow: How Mastercard Identity Fights Fraud, Drives Growth, and Fosters Financial Inclusion
The Facts
Every time you make a purchase online or log into an account, technology verifies that you are who you say you are. This happens—in real-time and behind the scenes—billions of times a day around the world.
As we conduct more of our lives online, digital identity technology enables organizations and people to interact safely. This software verifies your identity by analyzing multiple data elements such as your name, email, and device IP address to prove your identity, without requesting additional information that is not needed. Organizations rely on these solutions to verify their consumers and to stop fraudsters from wreaking havoc.
Rapid digitization has made it easier than ever to connect, but it’s also led to growing fraud threats. Emboldened by advances in technology, fraudsters have become more sophisticated. The Federal Reserve now considers Synthetic ID fraud—where a malicious actor creates a fake persona to apply for a loan, open an account, or make a purchase—the fastest-growing financial crime in the U.S., costing banks billions of dollars per year.
Consumers in the U.S. reported losing nearly $8.8 billion to scams in 2022, an increase of more than 30 percent from 2021. Victims of fraud lose more than just money. In 2022, nearly 90 percent of identity fraud victims reported emotional and physical impacts, feeling worried and violated.
Put simply, fraud erodes trust in the digital ecosystem. Digital Identity can stop it from being lost.
The Analysis
A trusted identity is a key accelerator of the economy. It makes secure global commerce possible, enables seamless consumer experiences, fuels financial inclusion, and fights fraud.
Mastercard Identity connects people with merchants, banks, and businesses, enabling them to interact with confidence how, where, and when they want. Powered by identity insights, machine learning, and biometrics, Mastercard Identity helps organizations worldwide—including leading digital players, retailers, travel firms, and financial institutions—verify and authenticate more genuine consumers while preventing fraud.
Digital identity unlocks a wide range of possibilities. Take commerce, for example. A small business owner opening an online storefront can approve more good customers with confidence. Genuine shoppers are approved quickly, without needing to reintroduce themselves each time they shop. Digital identity can drive this business’s online growth, while facilitating great customer experiences.
Digital identity also fosters financial inclusion. In the U.S. alone, 91 million people have little to no access to credit because they lack a credit history. With limited banking or credit history to refer to, these customers often become a blind spot to traditional credit-driven identity verification practices. Financial institutions remediate with high-friction identity-proofing solutions such as document requests or ID card scans. For consumers who lack a credit history and ID, access to financial services can remain out of reach.
The View From Mastercard
Mastercard Identity solves for this by drawing on multiple identity elements and analyzing the behavior of the applicant—how they hold their phone or type—to determine that the person is genuine. Mastercard’s network and machine learning-based solutions help authenticate more applicants who may be falsely declined through traditional verification processes. This, in turn, expands access to financial services and brings more people into the digital economy.
It’s important to note that identity verification should expand trust and empower people. Mastercard Identity embeds the highest security at each touchpoint and ensures people are in control of their data.
Quoteworthy
“We want to create a digital economy that feels like a local marketplace—safe, secure, and vibrant,” said Chris Reid, EVP, Identity Solutions, Mastercard. “With Mastercard Identity, consumers don’t need to reintroduce themselves each time they return to an online business, and businesses can approve more good customers. By turning digital transactions into trusted interactions, the global digital economy will continue to thrive and grow.”
What’s Next
To help deliver on its vision, Mastercard is expanding its partnerships worldwide, bringing safe, secure experiences to more consumers. The company is also continuing to invest in biometrics, a technology Mastercard has long championed as the most secure way to recognize individuals while providing a seamless checkout experience.
Looking ahead, Mastercard has committed to bringing one billion people into the digital economy by 2025. By helping financial institutions identify more genuine customers, Mastercard Identity is committed to fostering financial inclusion for more people around the world.