Cyber criminals know no borders; their modes and methods are ever-evolving. This is why collaboration should be an industry priority. We have just hosted the inaugural Mastercard Cyber and Security Summit in Australia, held in both Melbourne and Sydney. We invited industry professionals across ecommerce, financial services, fintech, and digital payments to come together and discuss just how we can protect trust and expand cybersecurity throughout an evolving ecosystem.
Below is a roundup of the roundtables presented by Ekata, NuData, and Ethoca.
- How to Manage the Trifecta: ID Theft, Application Fraud, and Account Takeover
Moderated by Ekata’s very own Steve Marsh, VP Global Product Marketing, and NuData’s Global Head Business Development, Graeme Bullock, this proved an incredibly popular session. Attracting bankers, fraud managers, trading platform executives, and payments professionals, everyone sitting sought an answer to how to perfect the balance between needing a seamless CX with needing to mitigate fraud.
As one banker lamented, “Why can’t we use the same sophisticated social engineering employed by cyber criminals to combat their attacks?”
Of course, the benefits of alternative data sources were discussed in depth, specifically biometrics, digital identity elements, and dynamic identity verification. Naturally, this led to further discussions over customer privacy concerns, data protection, and the age-old: what about customers who are not tech savvy?
Fortunately, an awareness of the unbanked and next generation of banking consumers was front of mind. As discussed in depth in Ekata’s blog on thin-file customers, more than 50% of digital account applicants are 35 or under. Therefore, intelligent, strategic friction is not just expected, it’s necessary. It’s all about knowing how and when to implement digital identity checkpoints – from onboarding to payment.
To understand more about securing digital interactions with behavioural and device insights, read about NuData here.
- Streamlining The Post-Purchase Digital Experience: Paperless Transactions, Digital Receipts, and Personalised Innovations
What topic unites a roundtable of fintech executives, cyber risk consultants, analysts, merchants, partners, and old-school bank fraud managers like no other? Friendly fraud.
There’s nothing friendly about friendly fraud.
Friendly fraud, also known as first party fraud, chargeback fraud, or, optimistically, transaction confusion, is not a new concept, nor a new challenge. However, it is multi-faceted, and evolving.
As the global economic climate continues to put pressure on consumers, first-party fraud will continue to affect merchants, issuers, and acquirers alike.
Ethoca’s Senior Vice President in Canada, Jeremy Bornstein and Ethoca Australia’s General Manager, Brett Small kick started this lively discussion with some heavy stats; with the surge in digital activity since 2020, some industries have experienced an 80% increase in consumer disputes, chargebacks, and friendly fraud. The most common cause? Transaction confusion.
“How do we discreetly deal with the avalanche of chargebacks,” Bornstein asked the table, “when such a small percentage is legitimate third party fraud?”
While the growth of ecommerce – and in turn, consumer disputes – was discussed, it was the issuers at the table who had a lot to say.
“We can’t see the light at the end of the tunnel when it comes to first party fraud,” lamented one fraud team member from an Australian bank. “There is huge area for improvement in the authentication space outside of the merchant space.”
A fellow banker agreed with his peer’s lament, hyper aware of the reputational damage banks face when challenging a customer; especially in the age of social media.
“It’s not always about convincing the customer,” he explained. “If we can’t prove fraud to our own internal customer advocacy team, we are liable!”
The good news is that solutions are available now. For merchants, when customers are given clarifying purchase details by their card issuers, transaction confusion is eliminated and unnecessary disputes drop some 65%. For issuers, digital receipt services have been shown to reduce inbound transaction inquiries from cardholders by up to 30%.
For more information on clarifying digital purchases, read more about Ethoca here.