Tag: covid-19

Fraud rates have held steady throughout the year despite the move to digital, but a few factors could change that this holiday season bringing greater losses than those of Christmas past. Globally, we’ve seen a spike in digital traffic as a result of Covid-19 the past 6-9 months, with some countries like Brazil reporting a 200% increase in digital traffic to retail sites. This means some physical fraud controls, like EMV or chip-and-pin, are no longer relevant. The number of data breaches this year compromised more than 36 billion records, eclipsing history’s reported record total. This means more legitimate credentials have been stolen, sold, and/or being used to commit fraud. On top of that, many businesses may be starting to loosen their online security restrictions in order to take full advantage of the topline revenue that comes with the influx of holiday traffic. This is especially true for those who’ve struggled to stay in business during Covid-19, who will look to increased holiday spending to offset declines earlier in the year. Unfortunately, fraud at the holidays is difficult to detect and there can often be a significant lag until fraud is realized, in some cases up to 3-6-months. So how do businesses protect themselves while providing a secure place for customers to shop online this year, especially during big events like Black Friday and Cyber Monday, while still offering a convenient digital experience? Businesses will need a layered approach to fraud management, and it starts by knowing what to expect. Holiday fraud trends to watch: Payment behavior: Most consumers will do all their holiday shopping online which means card-not-present payment fraud will likely spike, as fraudsters hide in the increased volume of traffic. With the shift from physical to digital transactions, traditional fraud controls, like EMV or chip-and-pin which are effective at minimizing card-present fraud, simply are not available to protect digital transactions. Average order value also tends to increase during the holiday season, requiring retailers to establish higher value thresholds for each order, to avoid flagging legitimate orders for review. Shipping behavior: Generally shipping behavior at the holidays is different than the rest of the year. People buy gifts and ship directly to the recipient, which means fraud detection logic that matches billing and shipping addresses to the legitimate cardholder may cause more false positives than fraud detection. Chargeback fraud: Holiday gift-giving pressure or loss of household income can sometimes lead to chargeback or friendly fraud, where a person may purchase an item – typically entertainment services or devices – use it and then return it, with or without intent to pay. Or in some cases, purchase an item, then issue a chargeback claiming no knowledge of the purchase. In-account fraud: Many retailers are now requiring a customer to set-up an account when making a purchase to identify their behavior and track purchase history. Like we’ve seen in the banking industry, fraudsters will use stolen login credentials to gain access to these legitimate accounts, make purchases using a card on file, and set up a secondary shipping address to re-route the items. Mule behavior: A newer form of fraud that’s gaining traction is where a legitimate customer is recruited to use either their shipping address or in some cases, their validated account to make a transaction using stolen payment information, receive the package, and forward to the fraudster’s address. Sadly, these fraudsters are known as “mule herders” are exploiting desperate, out of work people by recruiting them to work on their behalf. In the financial services space, victims may knowingly or unknowingly use their own bank accounts, to allow fraudsters to funnel money from other stolen accounts as part of an elaborate wire transfer or P2P payments fraud schemes. Phishing: The accelerated digital traffic during the holidays presents fraudsters a great opportunity to get consumers to click on all sorts of “offers” or fake merchant websites and steal personal information. This increase in phishing can take place across all known channels – email, phone, social, text, and web – and is a trend we’ve seen attack businesses and consumers alike. Unfortunately, fraudsters are appallingly impersonating health organizations, setting up fake cleaning and healthcare supply stores, Covid-19 statistic maps, and websites, all in an attempt to lure victims into divulging sensitive data. Who does fraud hurt the most? Online fraud during the holidays hurts many players in the transactional relationship – the legitimate customer, the merchant, and the bank or payment provider – but merchants tend to bear the biggest burden. This is best illustrated by the dispute process.  When making a purchase, the main relationship is between the customer and the merchant. However, when a stolen credit card is used, or when a consumer has been a victim of account takeover fraud or some other fraudulent behavior, the person will dispute the charge directly with their bank or credit card company (card issuer). Card issuers and banks will either hold the charges back or reverse the financial transaction until a resolution can be met with the merchant. It then lies with the merchant to prove that the transaction was in fact legitimate, and to dispute that chargeback. The consequences of fraud for the merchant include multiple pain points: the cost of the stolen goods (and any shipping fees), the chargeback fee, potential fines by the merchant’s acquiring bank, and potential reputational challenges. Fraud prevention during the holidays The pandemic has already put an incredible amount of pressure on businesses and the rise in sophisticated fraud attacks may seem insurmountable.  Creating a secure and convenient experience for your customers is possible and there are strategies and tools that can be implemented. Tools to layer into your fraud strategy: Require (and check) signatures upon postal delivery Offer immediate email confirmation and tracking number information Use a wide variety of digital and transactional data to make optimal risk/trust decisions Adopt dynamic risk strategies where controls can be adjusted to match the threat level Leverage machine learning models to access a variety of niche solutions or data sources for accuracy If 2020 taught us anything, it’s flexibility and resilience – two words that should describe your approach to fraud management this holiday season. The holidays can be a time of great joy, and this year most people are hoping the holidays will lift their spirits. Don’t let fraudsters dampen those holiday spirits! Related stories: New research available: The continued impact of Covid-19 on consumer behaviors and business strategies  Better identifying your customers leads to greater trust How to get more from your existing credit risk and fraud risk technology

In the not so distant past, consumers mostly interacted with their banks in person. Retail customers, for instance, waited in line to make a deposit or talk to a banker. And though the branch may have been busy, a moving line gave comfort to customers that the wait wouldn't be much longer. However, customer expectations in the digital era are dramatically different. According to Experian's new research, one in three customers will abandon a transaction if they have to wait more than 30 seconds, especially when accessing bank accounts. And that's just the tip of the iceberg. When it comes to the digital experience, consumers increasingly want seamless service at every point of their journey. Now, as the Covid-19 crisis continues to accelerate digital demand, financial institutions face more and more customers with similar if not greater expectations. Expectations for things like personalized products, contextual lending decisions, and offline-online seamlessness. And those organizations that understand these evolving needs and deploy cloud-based decision management to ensure they meet them will likely be the winners in this new world. Right here, right now Banking digital transformation was already underway before the pandemic began. Most retail banks provided some customer-facing app. In efforts to automate and streamline business processes, many organizations have also started to migrate their backend infrastructure from on-premise software to the cloud. The pandemic, though, ramped up the demand for everything digital seemingly overnight. Consider that consumer adoption of mobile wallets has jumped 11% since July, largely due to increased contactless in-payments. In the height of the crisis, customers turned to online platforms for financial assistance, from federal loans and grants to mortgage relief and credit applications to small business loans. Businesses that had already migrated to cloud-based solutions were able to scale their response to meet that growth. But that those hadn't? They faced the combined challenge of needing to scale existing services to serve the influx of online customers while simultaneously adding new digital capabilities. As a result, some organizations have ended up playing catch up with their digital offerings. Experian research shows, though, that it's a race worth finishing. Sixty percent of customers say they have higher expectations of their digital experience now than they did before the pandemic. To be sure, the crisis will end. Those expectations, however, are here to stay. A glimpse of the future Banks may see fewer customers in person, but that doesn't mean their service can't be personal. The data analytics features of cloud-based decision management software allow businesses to know more about their customers, providing personalized offers and services right when customers need them most. One bank we work with in India provides an ideal example. They've leveraged deep analytics and decisioning solutions to accelerate their online loan approval process from days down to seconds. They're no longer turning people away who are good candidates for loans. And they've increased their lending without having to take on additional risk. It's a win-win that reveals how organizations can leverage technology to satisfy customer expectations during the height of a crisis and continue to in a post-Covid reality. With cloud-based solutions, organizations can become 100% customer-centric, both in convenience and personalization. The data gives financial institutions a holistic view of their customers, enabling them to anticipate needs and tailor solutions to the individual. Transformation and soon No organization is going to digitally transform overnight. But given the urgency of the demand, there are proven ways to improve their digital customer experience sooner rather than later. Small-to-mid-sized organizations, for instance, should consider out-of-the-box Software-as-a-Service (SaaS) solutions. These offer pre-determined, high-demand use cases such as online eligibility checks and customer acquisition tools. Organizations can modify these solutions to meet specific market needs while saving time on ramping up a fully custom solution. Additionally, even with the imperative to meet the digital demand, it's important to remember that proper planning leads to successful cloud migrations. Consider all the possibilities of what could go wrong and right in terms of incident management, customer service, links to data sources, and more. Rehearse your transition as much as feasible. The preparation may add a bit of time on the front end, but you'll decrease the likelihood of significant disruption when you do migrate and that's worth the effort. The march toward an increasingly digital customer experience only moves in one direction: forward. The pandemic may have pushed financial institutions to speed up their transition to cloud-based decision management, perhaps a bit earlier than some anticipated. But the outcome of a proactive, data-driven organization centered on serving customers promises to be better for everyone. Related stories: New research available: The continued impact of Covid-19 on consumer behaviors and business strategies  Automating fairness: Using analytics to help consumers in a pandemic era In digital transformation, small wins lead to big outcomes 

As the world faces another resurgence of the coronavirus, businesses will again be tested on their response—but this time consumer expectations will be much higher. In the beginning of the pandemic, businesses scrambled to set up remote workforces and new ways to support customers as everything locked down. In the short-term, many consumers stayed loyal to businesses they frequented before Covid-19. However, our recent research shows that loyalty may not be a given going forward. Download Global Insights Report – September/October edition Key insights: 1 out of 3 consumers is only willing to wait up to 30 seconds before abandoning an online transaction, especially when accessing their bank accounts. Half of the businesses surveyed have either mostly or completely resumed operations since Covid-19 began but only 24% are deliberately making changes to their digital customer journey. 60% of people have higher expectations of their digital experience than before Covid-19. In mid-September 2020, we surveyed 3,000 consumers and 900 businesses in 10 countries, including Australia, Brazil, France, Germany, India, Japan, Singapore, Spain, the United Kingdom, and the United States. This report is the second of three in a longitudinal study exploring the major shifts in consumer behavior and business strategy pre- and post-Covid-19. Our first report in the sequence, published in  July/August, can be found here: Global Insights Report – July/August edition. Though businesses worldwide have started to see their operations stabilize, moving from survival mode toward sustainability, growth still presents a challenge. High expectations for security and convenience compounded by the increased demand for online payments, banking and shopping are pushing businesses to re-imagine the customer journey—and the investments they make to drive future growth. Top 5 initiatives amongst banks, payments, and retailers that have been accelerated by Covid-19: Use of AI to improve customer decisions Strengthening the security of mobile and digital channels Increasing digital acquisition and improving engagement Automating customer decisions Understanding customer profiles (e.g. affordability, preferences, behaviors) Most consumers reported a positive experience in their sudden shift to the digital channel and plan to increase their online transactions. The pandemic has also accelerated the move toward contactless payments for when shopping in-person is essential. The result has been a merging of consumers’ online and offline worlds calling upon businesses to create a fluidity between cross-channel interactions. 61% of people surveyed now regularly order groceries or food delivery online. This is a 7-point increase in this type of online payment since July. Adoption of mobile wallets has jumped +11% since July as consumers continue to increase their online activities and contactless in-person transactions. 70% of businesses have a plan to move customers out of Covid-induced collections but the implications of that impact on the balance sheet and future provisions are not yet clear. Regardless of where they’re transacting, consumers expect a secure, convenient experience—and they’ll quickly abandon financial transactions if they’re let down. Are businesses adapting the customer journey as quickly as customers are expecting more from their digital experience? Keeping up with consumer expectations: 77% of people said they feel most secure when using physical biometrics, and 62% of people said it improves their customer experience when managing finances or payments online. Consumers are most concerned about protecting their financial data over other types of information (e.g. personal, contact, web history). The concern is highest in France (46%) and Japan (43%). For the past 3 years, consumers trust payment system providers (e.g. PayPal, WePay, Apply Pay) the most for consistently providing a secure and convenient digital customer experience. Find out what top 3 solutions businesses are using to help improve the customer journey.

We’ve compiled the top October headlines from across the globe to keep you in the know on the latest hot topics and insights from our global experts. Q&A: Consumer and business outlooks since Covid-19 David Bernard, Senior Vice President of Global Marketing and Strategy, provides his perspective on consumer demand for digital banking and business preparedness. #TradeTalks: The Shift in Online Trends as a result of Covid-19 In this Nasdaq #TradeTalks podcast, Steve Wagner, Global Managing Director of Decision Analytics, discusses how Covid-19 is driving consumer behavior change and accelerating the shift to digital. 43% of Indian consumers record decline in household income: Experian Global The Economic Times covers global research findings on the impact of the Covid-19 pandemic on Indian consumer income, with insights from Sathya Kalyanasundaram, Managing Director, Experian India. Qual será a velocidade da retomada da economia brasileira em 2021? This Estado de Minas article explores viewpoints on what the state of the Brazilian economy will be in 2021, citing current trends across different sectors. TechBytes with Marika Vilen, SVP Platform Commercialization, Global Identity & Fraud at Experian MarTech Series speaks with Marika Vilen about meeting customer needs in the 'new normal,' managing identity and fraud prevention strategies, benefits of device intelligence, and industry trends. Stay in the know with our latest insights:

We may not always get what we want, but in many cases, if we feel that we were treated fairly, we’re satisfied. Our July 2020 global research reveals as much—in the survey, 52% of U.S. consumers that believed that organizations treated them fairly during the Covid-19 crisis said they’d give the company more of their business. Conversely, 76% of consumers who thought businesses treated them unfairly reported that they wouldn’t be returning customers. As we progress through the pandemic, fairness will become a critical component of the customer experience. Government support for workers and businesses in many countries is ending, and we’re likely only beginning to feel the real economic impacts. Financial institutions that prioritize fairness in their customer engagements—and leverage advanced analytics and automation to help—will likely retain more customers in the near-term and build relationships that last into the future. We’ve only just begun  For most of the West, the pandemic began in earnest in March. The economic consequences were quick to follow. In our global survey conducted in July, two times as many consumers reported that they were having difficulty paying their bills compared to before the Covid-19 crisis. As a response, 20% of consumers said they were cutting back their discretionary spending, and another 13% reported that they’d dipped into their savings to make ends meet. Around the world, those who were struggling reached out to financial institutions for help. A full 5% of global consumers enrolled in some form of financial assistance, including from savings and loan institutions, retail banks, insurance companies, and government programs. Hearteningly, more than half of these consumers said they’d had a positive experience. And as previously noted, a similar percentage felt they were treated fairly. That’s the silver lining of an exceptionally challenging year. However, for consumers, the struggle will likely continue. Much of the support that financial institutions have provided came via government aid or mandates that are close to expiring. For instance, in the U.S., the CARES act required lenders to offer homeowners six months of fee-free forbearance on loan payments. With that grace period coming to an end, one lender reports that only 10% of borrowers have exited forbearance into a modified payment plan. Government assistance is running out, but the fact that entire sectors such as travel and hospitality remain incapacitated should still cause concern. Over the next year, consumers will likely continue to face financial obstacles, but with a shrinking safety net. Streamlining fairness Amidst the continued uncertainty, organizations should continue to prioritize fairness. Advanced data analytics can help with that task, and the technology also promises to make it easier and faster. Consider that in the 2008-2009 financial crisis, assessing a customer’s ability to afford a loan or credit product was primarily a manual process. Organizations faced backlogs of customers needing help and were unable to respond in a timely manner. Today, financial institutions can use advanced analytics and machine learning to leverage data, with the specific aim of assisting customers in financial straits. For instance, it may not be feasible for banks to permit customers to remain forbearance for another six months. However, they can use data to quickly and accurately determine what payments customers can afford. The technology enables organizations to scale their financial workout or accommodation efforts, reducing the manual workload. Just as importantly, the analytics also provides data to back decisions, making the process more transparent. There’s a big difference between thinking you’re being fair and being able to prove it. With an analytics program, organizations can inform customers exactly what they’re being offered and why. Understanding the data empowers customers to make better decisions about whether they accept any aid. In some parts of the world, regulators are also requesting similar assurance that the banks have provided options in the customers’ best interest. A challenge—and opportunity Fairness and trust are closely connected. And when it comes to the customer experience, incorporating both yields happier, more loyal customers. I often think back to work I did with a banking organization earlier in my career. Our NPS scores regarding our collections, recovery, and fraud team were quite good. It’s easy to assume that customers in financial distress may be less than pleased to be dealing with creditors or lenders. But the dynamic shifts when you’re able to help them at the time they need it most. Now, thanks to data and advanced analytics, financial institutions can implement fairness at every turn—limiting the economic damage to customers, reducing their own risk, and enhancing their relationships along the way. Related articles: Global research study: The impact of Covid-19 on consumer behaviors and business strategies The role of the virtual assistant: Meet consumer demand for digital experience Digitally managing your at-risk customers most impacted by Covid-19

Several months into the global pandemic and we know that general indicators of risk or stress don’t reveal enough about what’s really going on within your customer portfolios. We also know that most institutions heavily use statistical models in identifying and capturing risk drivers in order to make decisions. Active model calibration in current circumstances can have a measurable effect on approvals and expected loss within a few weeks of being implemented. Banks have managed through economic recessions and other stressed scenarios by adjusting various levers for liquidity and risk. None, however, have ever had to predict consumer behavior in a pandemic. How can credit risk executives regain control over disrupted risk models at a time of constant change? Four key actions to enact now for immediate and sustainable impact:  1. Increase the frequency of model health monitoring Many of the predictive models that financial institutions rely on aren’t stable enough to handle real-world disruptions. Nor are the models re-calibrated frequently enough to appropriately assess risk in the rapidly changing situation we currently face. Monitoring models on a quarterly basis isn’t enough, but that tends to be the average frequency for most financial institutions. Increasing the frequency of model monitoring processes and identifying the need for a change in models sooner leads to significant financial impact. Depending on the asset size of the institution and the specific use case, financial institutions can potentially save millions of dollars in lost revenue or avoided credit losses. Automating the process supports an increased frequency of monitoring while requiring less effort from your analytics team. 2. Carry out ex-ante stress testing for your models Businesses should consider using ex-ante stress testing, in light of the difficulty in maintaining the accuracy of model predictions in changing conditions as well as to meet the heavy governance requirements of new models before their actual use. Traditional ex-post processes are effective in simulating what would have happened historically had a new model been in place. This is an extremely valuable exercise but isn’t very helpful in the current stress environment which is both unique and highly uncertain. Risk managers would like to have a go-forward view on model performance for decisions being made right now, not just a look-back view on decisions made historically. Applying ex-ante stress testing allows us to simulate and analyze a range of possible outcomes based on changing macro conditions, evolving consumer behaviors, and other uncertainties like the quality of underlying data. 3. Make practical, short-term adjustments We’ve seen in previous economic downturns that models can rapidly become unfit for purpose, and the consequences may not be fully apparent until long after the start of the downturn. In such circumstances, you shouldn’t necessarily attempt to make changes that you expect to be robust for many months into the future. There’s a strong case for making adjustments that are designed to address temporary circumstances and reviewing them at an increased frequency. Some businesses are taking a conservative strategy by tightening their credit policies and decisioning strategies. Other businesses are overlaying their models with certain attributes. For example, one could look at the number of open inquiries in the past 30 days. Since we know that attribute is unstable, we can pair it with an attribute that will give you more population stability – such as average open inquiries over the past 6 months. 4. Setup for rapid re-calibration or re-build of models The decision to re-calibrate or re-build a model during the pandemic would depend on multiple factors including the business need and model use case, the performance of the existing model, and the confidence in the quality and relevance of data for the model build. However, it is important that financial institutions and other businesses are set up to rapidly update their models. They should be actively working on re-calibrating/re-building their models in a test environment, evaluate the impact, and be prepared to deploy.  The ability to rapidly update models will be a key differentiator as businesses compete to grow their portfolios and manage losses during and in the aftermath of this pandemic. As with many other aspects of our lives, credit risk management is being challenged by the new reality created by a global pandemic. Whether our response is temporary, or whether the crisis is accelerating an existing trend to be more active in model management, we need to react to maximize our portfolio performance. At the end of the day, none of us have been through a pandemic but we know our models can still work. It’s all about model accuracy and model governance and reducing error rates. By increasing the frequency and efficiency of model monitoring and re-calibration, we can drive business outcomes with more impact than ever before. Learn more: For many organizations, navigating and recovering from these volatile times will remain top priorities as they begin strategizing for the future. Get details on accelerating your digital transformation.

The Covid-19 crisis has been a bit like existing inside a shaken snow globe—it disrupted everything, and a lot remains up in the air. However, amidst the uncertainty of the pandemic, one thing has become evident: Cultivating customer trust is more critical than ever. Trust naturally generates loyalty. This is especially true during and after a crisis. For example, Experian's latest global research from July 2020 shows 52% of customers who felt that businesses treated them fairly during the pandemic plan to give those companies more of their business. That fairness bred trust and that trust will undoubtedly lead to more business. As consumers continue to increase their digital transactions, companies need to work hard to enhance customer trust. Improved identity authentication and recognition, for example, will play a key role. As everything begins to settle, those that succeed will find their business on far more steady ground. Does trust even matter? It's a good question—and the answer may be evolving in real-time. Consider that in 2019, Experian's global identity & fraud study showed that digital adoption did not indicate consumer trust of the business. "Consumers still adopt digital channels despite being highly skeptical of the businesses," the study noted. Social media provides an excellent example. Overall, most consumers distrust many of the popular social media platforms, yet they continue to use them regularly. Interestingly, widespread adoption is linked more to convenience than trust. However, this comes with a real caveat: Customers are less concerned about trust when the product is more frivolous. For instance, not trusting a media outlet or social media platform is very different from not trusting a financial institution. Also, a lack of adoption doesn't always mean that customers don't trust the business. In the financial service and payments realm, low adoption may simply reflect that customers use the platforms less regularly. Now, as consumers increase their reliance on online services, maintaining trust will be paramount. For instance, since Coronavirus began, consumers have increased their use and awareness of mobile wallets by 8%, and their use of retail payment apps by 6%. Balancing the convenience that people have needed with the necessary trust will go a long way towards keeping usage high once the crisis subsides. A virtuous cycle Within any digital experience, several components inform customer trust. You want to ensure accurate customer recognition, as well as transparency with your authentication. Robust fraud protection and positive digital experiences also play essential roles. These form the Cycle of Trust, a virtuous circle that ultimately encourages customers to share more information with your company and pursue more transactions. Our 2019 study reveals the importance of each part of this cycle, and we see it playing out now. For example, 90% of consumers are willing to participate in a more thorough identity verification process early on to have easier account access in the future. The ability to routinely and accurately recognize your customers helps build their trust in your technology and products. Also, 76% of customers have more confidence in companies that use biometrics over passwords to protect their information. That means that you can use advanced authentication strategies to enhance trust even more. Transparency also comes into play. Letting people know how you're using their information and whom you're sharing it with makes them more apt to trust your organization—and continue to share their data. The future of trust This cycle represents the goal. In practice, though, there are still quite a few challenges that prevent organizations from getting that wheel spinning. For instance, many have separated the risk assessment processes of verifying customers at signup, logging in, and transacting, so there's no seamless experience. Instead, customers navigate different solutions to onboard, authenticate their identity, and complete transactions. A company may recognize a customer at one point in the process, but not all the way through. What's more, organizations often still place the onus on the consumer for how they represent themselves in the digital world. Authentication processes require them to remember passwords or retrieve codes from their phone. But as noted, the pandemic has opened an opportunity for dramatic improvement. Consumers are at a rare moment in which they're open to change—and they're even looking for it. For example, since the beginning of the pandemic, 60% of customers say they have higher expectations for online experiences. More than half of customers are also more willing to provide organizations they trust with personal information and financial data. Finally, 44% of customers note that since Covid, they are more trusting of companies that demonstrate security. So how can you increase trust while also meeting evolving customer expectations? Organizations that pave the way will likely assume more responsibility for recognizing and authenticating customers. This starts with becoming more creative in using the data they already have access to recognize and authenticate customers. Extending this passive and continuous recognition across channels will also be necessary. Doing so connects the disparate processes and creates a more seamless digital experience. Such initiatives also remove the identity burden from the customer and kickstart that virtuous cycle. No one anticipated the Covid-19 crisis. But it's opened up the chance to create fairer, more trusting, more transparent digital experiences for everyone—and companies shouldn't pass that up. Related stories: Latest global research: The impact of Covid-19 on consumer behaviors and business strategies Better identifying your customers leads to greater trust Covid-19 as a Gateway to Fraud: Top 5 Global Fraud Trends to Watch Out for in 2020 Podcast: Securing online identity

In case you’ve missed these September headlines, we’ve compiled the top global news you need to stay in-the-know on the latest hot topics and insights from our experts. Transforming analytics into business impact CIO.com shares insight on using analytics to maximize business outcomes from IT leaders, including Shri Santhanam, Executive Vice President and General Manager of Global Analytics and AI. Global shudder: How businesses and customers are reacting to Covid-19 This MediaPost article covers global research findings on the impact of the Covid-19 pandemic, as well as perspective on the trends and what’s to come, from Steve Wagner, Global Managing Director of Decision Analytics. Experian touts Biocatch behavioral biometrics, adds Onfido face authentication for onboarding Biometric Update shares the latest on enhanced fraud detection for new account openings through a layered approach. Marika Vilen, SVP Platform Commercialization, Global Identity and Fraud, speaks to optimizing operations in today’s environment. Experian’s cloud-based solutions adapt to today’s evolving customer needs In this AiThority article covering cloud-based solutions for automating decisions, Donna DePasquale, General Manager, Executive Vice President of Global Decisioning, shares her perspective on businesses meeting the needs of today’s changing market. Why businesses need to meet the challenge of digital acceleration Steve Pulley, Managing Director of Data Analytics, offers global insights on continuing operations through an evolving digital marketplace impacted by Covid-19 in this Bdaily, United Kingdom, article. Stay in the know with our latest insights:

Whether you work for a small or big company, chances are you’ve seen budgets contract in the wake of Covid-19.  There are a lot of factors contributing to it: fluctuating economic outlooks, building up loan loss reserves, and re-directing expenditures to keep employees and customers safe and secure. A recent global study of banks and retailers found that the top area of short-term investment was securing the mobile and digital channels. In fact, it also showed that 80% of businesses put a digital identity strategy in place, a 30-point increase since Covid-19 began and 60% of businesses are planning to increase their budgets for credit risk analytics and fraud prevention, respectively. So why is it that only 32% of banks and retailers feel operationally ready for their customer’s continued demand for digital engagement? The Capex required to invest in new technology these days requires a fiercely competitive business case. Not forgetting to mention, if approved, it could be a while before you see a return on your investment. But it doesn’t mean the latest advancements and innovation available for managing credit risk or fraud risk is out of reach. Getting more out of your existing tools and technologies is easier to implement and quick to deliver results. In fact, since Covid-19 began, hundreds of clients have optimized their use of credit and fraud risk software and analytics, helping them focus on creating more meaningful customer relationships and saving them millions in potential losses. Here are two examples of how you can get the most out of your existing technologies today and a checklist for evaluating your current tools. Device recognition Beyond securing systems against Cybersecurity threats, businesses need to think like the criminals they’re trying to deflect. If it seems like the world all went digital overnight because of Covid-19, then you can bet fraudsters were one step ahead exploiting the blind spots in the customer relationships you quickly moved online. But how do you recognize your customer behind their mobile device or computer screen? One way is to discern a fraudulent (or “mimic”) device from a genuine one. Having access to this information allows you to swiftly see the same device repeating both good and bad behavior and thus have a better chance of isolating the mimic device and mitigating fraud attacks. This is done by creating a strong probabilistic measure to determine whether two events are from the same device or not. How does this help? It helps to reduce over-firing fraud velocity rules and more precisely out-sort fraud events for manual review. It’s not as complicated as it sounds, and many businesses already have access to this device intelligence data which simply requires them to either turn it on or upgrade their fraud management systems to its latest version. In fact, additional device data points are always being added, and upgrading this layer is often recommended as it can provide up to 85% improvement in performance. Bottom-line: Device data bolster the effectiveness of your customer identity and fraud defenses with little impact on operational resources and reduces friction on your customer’s digital experience. Machine learning Innovations in decision management are having an impact on areas traditionally associated with predicting consumer behavior, such as credit risk, collections, and fraud detection. The ubiquity of data nowadays requires the methods used to derive actionable insights to evolve and most lenders globally have started to adopt advanced analytics. Nearly 70% of businesses increasing their use of machine learning for determining creditworthiness since Covid-19 began. For the collections process, it has helped to determine the best way to contact a delinquent customer or the best treatment to use as a customer exits Covid-induced forbearance?  For card, mortgage, and automotive portfolios, machine learning has played a strategic role in creating and implementing pricing strategies to determine the most accurate decisions for financing terms. Perhaps it’s in fraud detection where machine learning is having the biggest impact. Unlike how it’s applied in credit risk decision strategies, machine learning used for fraud detection can be trained to learn and improve with experience without explicitly being told to do so. It excels at solving problems where the “problem space” cannot be defined easily by rules, which makes it a great complement to mature rules-based fraud management systems. Furthermore, machine learning models can take advantage of the different data points from all backing applications at the time of any single transaction, login, or submission. This produces a final decision that’s more accurate than that produced by a simple rules-based approach or manual decision matrix. Attributes that once provided minimal lift when analyzed in a silo may now provide a substantial lift to predict credit risk or prevent a fraud attack when combined with multiple data elements. Conversely, legitimate events that were inadvertently triggered by traditional fraud detection methods can be identified as authentic before having a negative impact on the customer’s experience. Bottom-line: A layered approach continues to be a key component in any credit decision or fraud detection solution and machine-learning models are the final call in your decision workflow strategy so they can leverage all the previous decision data. Checklist: Evaluate whether you’re getting the most from your decision technology Is your current solution providing the results you need? Avoid comfort in patterns and request a business review of your current solution to analyze performance. It may reveal unknown gaps and opportunities to improve your business results. How do your results compare to your peers? Some peer benchmarking is publicly available, but most vendors offer peer (blind) benchmarking using your specific performance data. It’s worth the ask! Are you using all the functionality your tool has to offer? Sometimes decision technology is implemented with a myopic focus on solving a specific problem or used in a specific area despite a broad range of functionality available that covers more use cases. Are you using the most up-to-date version of your tools? Check with your vendor right away and stay informed regarding newer versions. Upgrades generally require less effort and cost than a new solution and by continuously monitoring for the latest version, you’re able to meet current regulatory and policy standards. Are there any ‘add-ons’ available? Your existing decision technology may offer add-ons to enhance your current solution. Add-ons such as new or enriched data sets, updated scores or models or new software features may extend the business usage of a solution to different processes and within additional departments. Are your technologies integrated to enhance your credit risk and fraud risk decision workflow? Integrating your technologies can help you to execute credit and fraud strategies seamlessly with less chance for error, manual intervention, or duplicating actions across disparate systems. Technology is critical in meeting customer demand and staying competitive in any market. It can help balance the demand for internal resources while providing the service your customers deserve. But as organizations look to stay competitive, and agile through a volatile economic time, remember the importance and tangible benefits of optimizing what you already have in place. Related articles: Global research study: The impact of Covid-19 on consumer behaviors and business strategies Podcast: Banking trends and opportunities in the post-Covid-19 era Are traditional online identification methods becoming obsolete? Case study: Layered behavioral biometrics, device intelligence and machine learning 

In this episode of the Insights in Action podcast we speak with David Bernard, Senior Vice President of Global Marketing and Strategy, about managing digital transformation in the face of unprecedented challenges such as those originated by the global Covid-19 (Coronavirus) pandemic. While the internet has long been a lifeline, technology companies now appear to be the backbone of a global virtual working and collaboration scheme on a scale never experienced before. David shares his perspective on: How business leaders can help accommodate system stressors caused by evolving needs What actions and technologies can help accelerate or scale digitalization efforts Shifting to the cloud without rushing key strategic decisions Managing virtual teams "There’s a lot of comfort as a leader in seeing a solution that works — even if it’s not completely very sophisticated, and building in a Covid time — rather than doing a big ‘what’s it for’ project to design something from scratch and having a long project before implementing something that has all the bells and whistles. So, it leads to a demand for what I would call more software-as-a-service (SaaS) packages and more pre-configured solutions than the highly configurable world that we have seen in the past." - David Bernard >> Listen now to the full episode of this Insights in Action podcast

To keep you informed, we’ve gathered the top global, August headlines covering the latest insights from our experts and recent hot topics. Email attack type: Account takeoverZDNet Japan covers ATO (account takeover) fraud and the variety of techniques used in this attack type to access user accounts and ultimately steal money or sensitive information. In today’s rapidly changing economy, businesses need to get consumer recognition rightDavid Britton, VP of Global Identity & Fraud, shares insights on the disparity between businesses' confidence in recognizing consumers and consumers' lower confidence in this capability by these businesses. EDBI invests in fraud protection fintech VestaThe Straits Times, Singapore, provides an overview of this investment, including details around the increase in online fraud losses recognized across the Asia Pacific (APAC). How banks can balance UX and security amid a pandemicThis Forbes article explores the impact of Covid-19 on consumers, including the critical need for banks to balance consumer protection and good user experience. Stay in the know with our latest insights:

It was Dr. Simon Ramo’s vision of a ‘cashless society’, made possible by information and technology, that led to the creation of Experian’s business in the U.S. in the 1960s. He could see how information was going to change the way people lived and envisioned a future where systems would enable the rapid transfer of information to establish patterns of payment and individual creditworthiness. The democratization of digital financial tools and initiatives to improve financial literacy can create promising beginnings for countless disadvantaged individuals. Fast-forward to the present, and the global Covid-19 (Coronavirus) pandemic has taken the world by storm, proving a catalyst for an accelerated path towards a cashless society. Our recent proprietary research indicates that: Since Covid-19, we’ve seen growth in the use of mobile wallets (+8%), such as Apple Pay, and retail apps (+6%), such as Starbucks. The largest areas of growth for using digital payment methods are online grocery shopping (+7% increase) and ordering food (+6%). 50% of consumers globally intend to increase their online activities (banking, payments and shopping) in the next 12-months. Over the past decades, many developing countries such as India and China have recognized the value digital payments deliver to communities. Those governments are fully invested in their cashless society initiatives with a view to increase financial inclusion, improve security, boost trust online, and leverage their high mobile penetration rates to expand the adoption of mobile payments and services. A cashless society brings greater visibility into a larger number of transactions, reducing the potential risk of money laundering, bribery and corruption. It also allows central banks to have a more accurate view into how much money is in circulation, helping them prevent cash hoarding. On the other hand, businesses don’t need to maintain cash reserves, bank their cash payments or pay bank charges for withdrawing physical currency, which means that less ATMs to service and less cash to process leads to more resources to put at the service of their customers. More about our research From June 30 – July 7, 2020, we commissioned an independent research firm to survey consumers and businesses in 10 countries worldwide to understand the impact of Covid-19 on changing consumer trends and behaviors and business strategies and operations. >> See New global research insights: The impact of Covid-19 on consumer behaviors and business strategies for more insights from this study