Financial Services

The credit card market is rapidly evolving, driven by technological advancements, economic volatility, and changing consumer behaviors. Our new 2025 State of Credit Card Report provides an in-depth analysis of the credit card landscape and strategy considerations for financial institutions. Findings include: Credit card debt reached an all-time high of $1.17 trillion in Q3 2024. About 19 million U.S. households were considered underbanked in 2023. Bot-led fraud attacks doubled from January to June 2024. Read the full report for critical insights and strategies to navigate a shifting market. Access report

Today’s fast-paced, digital-first hiring environment calls for a more comprehensive approach to pre-employment screening. With growing pressure on employers and HR teams to make swift, accurate, and secure hiring decisions, having access to the tools and data to enhance efficiency and security is more important than ever. By evolving beyond traditional screening methods, background screeners can better meet these needs and deliver added value to their clients.  Fraud remains a significant challenge. In fact, fraud scams resulted in a staggering $485.6 billion in losses in 20231 — and hiring teams aren’t exempt from these risks. Fraudulent resumes, synthetic identities, and the risk of non-compliance with evolving regulations create a challenging landscape for pre-employment verifications. What if there was a way to make smarter, faster, and more secure hiring decisions? This article explores how background screeners can optimize pre-employment verification processes, reduce fraud risks, and ensure compliance — all while delivering a positive candidate experience. What is pre-employment screening? Employers conduct pre-employment screenings to thoroughly evaluate job candidates and make informed hiring decisions. It’s designed to verify key details about candidates, such as their identity, employment history, and references among others to assess their suitability for a role and ensure compliance with industry regulations. Enhancing traditional screening processes For decades, pre-employment background checks have been a cornerstone of the hiring process. While effective, many traditional methods face challenges in keeping up with the evolving demands of modern hiring. Delays in hiring: Background checks can oftentimes rely on manual processes, which could extend timelines leading to delays of days or even weeks. This not only slows down hiring cycles but can make it harder for employers to compete for top talent in a tight labor market. Errors and inaccuracies: Human errors, incomplete data, and inconsistencies across systems can lead to missed insights or red flags. Fraudulent activity: As hiring becomes increasingly digital, identity theft and synthetic identities present growing challenges to verifying candidate-provided data.  Regulatory challenges: With regulations like the Equal Employment Opportunity Commission (EEOC) and Fair Credit Reporting Act (FCRA), companies must navigate complex compliance requirements to avoid legal and financial repercussions. 1 in 3 HR professionals report losing top candidates due to slow pre-employment screening processes.2 These challenges highlight the opportunity to build on existing screening practices with tools that enhance speed, provide actionable insights and prevent fraud. Adapting to the evolving fraud landscape Employment fraud is becoming increasingly sophisticated, fueled by trends like the rise of remote work and digital applications. In fact, the employment sector accounted for 45% of all false document submissions in 2023, making it the most targeted industry for fraud.3 From fake references and degrees to synthetic identities created using stolen personal information, the risks are higher than ever. Synthetic identity fraud: This form of fraud — where fake identities are created by combining real and fabricated data — makes up more than 80% of all new account fraud.4 Fake credentials: Many candidates falsify qualifications or work histories to enhance their chances of securing a role. Compliance risks: Failure to verify candidate information accurately can result in legal penalties, brand reputation damage, or internal security breaches. Modernizing pre-employment screening The good news? Experian offers advanced solutions that complement existing screening processes, empowering background screeners to deliver more efficient, secure and reliable results for their clients looking to higher faster, and with greater confidence.  Gain a more holistic view of a candidate’s risk profile: Experian’s nationwide database contains files on more than 245 million credit-active consumers, providing the most current, accurate, and comprehensive information available in the industry. Conduct real-time identity verification: Leverage a range of identity verification solutions to authenticate and verify a candidate’s identity by accessing a breadth set of non-credit and credit data sources to create a robust social footprint that defines each consumer as unique individuals. Integrate advanced fraud detection: Powered by purpose-built analytics and machine learning algorithms, Experian’s fraud detection tools can detect synthetic identities, inconsistencies, and other red flags while ensuring a seamless candidate experience. Enhance compliance efforts: Experian’s solutions are designed to help businesses navigate complex compliance requirements with ease. Fraud prevention playbook in preemployment Uncover essential strategies for fraud prevention and identity verification in employment screening. Download now The pre-employment screening landscape is evolving, and staying ahead requires tools that enhance the efficiency and effectiveness of your processes. Experian’s advanced solutions are designed to complement your existing screening services, helping you reduce fraud risks, maintain compliant, and deliver data-driven insights that empower smarter hiring decisions. Get started today Ready to transform your pre-employment verification process with fraud mitigation and identity verification solutions? Explore our innovative solutions today. Learn more 1 Nasdaq finds scams led to $486 billion in losses in 2023, 2024. 2 Research reveals Candidates’ Frustrations with Hiring Process, 2024. 3 Employment Identity Fraud: Do You Know Who You’re Hiring, 2024. 4 Report: Synthetic identity fraud is growing, 2024.

Generative AI (GenAI) is transforming the financial services industry, driving innovation, efficiency and cost savings across various domains. By integrating GenAI into their operations, financial institutions can better respond to rapidly changing environments. GenAI is reshaping financial services from customer engagement to compliance, leading to streamlined operations and enhanced decision-making. The strategic role of GenAI in financial services Adopting GenAI in financial services is now a strategic imperative. A 2024 McKinsey report (The State of AI in 2024) notes more than a 10% revenue increase for companies using GenAI. As institutions strive to stay competitive, GenAI provides powerful tools to enhance customer experiences, optimize operations, accelerate regulatory compliance, and expedite coding and software development. Key areas where GenAI is making an impact Enhanced customer engagement Financial institutions use GenAI to offer personalized products and services. By analyzing real-time customer data, GenAI enables tailored recommendations, boosting satisfaction and retention. Streamlining and optimizing operations GenAI automates tasks like data entry and transaction monitoring, freeing up resources for strategic activities. This accelerates workflows and reduces errors. Further, GenAI-driven efficiency directly cuts costs. By automating processes and optimizing resources, institutions can lower overhead and invest more in innovation. Deloitte’s Q2 2024 study found AI automation reduced processing times by up to 60% and operational costs by 25%. Accelerating regulatory compliance GenAI simplifies compliance by automating data collection, analysis and reporting. This ensures regulatory adherence while minimizing risks and penalties. According to a 2024 Thomson Reuters survey, AI-driven compliance reduced reporting times by 40% and costs by 15%. Developer coding support for efficiencies GenAI is an invaluable tool for programmers. It aids in code generation, task automation and debugging, boosting development speed and allowing focus on innovation. Gartner’s 2024 research highlights a 30% improvement in coding efficiency and a 25% reduction in development timeframes due to GenAI. Accelerating credit analytics with Experian Assistant Within the credit risk management space, GenAI offers a powerful solution that addresses some known pain points. These relate to mining vast amounts of data for insight generation and coding support for attribute selection and creation, model development, and expedited deployment. Experian Assistant is a game-changer in modernizing analytics workflows across the data science lifecycle. Integrated into the Experian Ascend™ platform, it’s specifically designed for analytics and data science teams to tackle the challenges of data analysis, model deployment and operational efficiency head-on. Capabilities and skills of Experian Assistant Data tutor: Offers comprehensive insights into Experian’s data assets, enabling users to make informed decisions and optimize workflows Analytics expert: Provides tailored recommendations for various use cases, helping users identify the most predictive metrics and enhance model accuracy Code advisor (data prep): Automatically generates code for tasks like data merging and sampling, streamlining the data preparation process Code advisor (analysis): Generates code for risk analytics and modeling tasks, including scorecard development and regulatory analyses Tech specialist: Facilitates model deployment and documentation, minimizing delays and ensuring a seamless transition from development to production Driving more-informed decisions Adopting GenAI will be key to maintaining competitiveness as the financial services industry evolves. With projections showing significant growth in GenAI investments by 2025, the potential for enhanced efficiencies, streamlined operations and cost savings is immense. Experian Assistant is at the forefront of this transformation, addressing the bottlenecks that slow down analytical processes and enabling financial institutions to move faster, more informed and with greater precision. By integrating the capabilities of the Experian Assistant, financial institutions can leverage GenAI in credit risk management, automate data processes, and develop customized analytics for business decision-making. This alignment with GenAI’s broader benefits—like operational streamlining and improved customer experience—ensures better risk identification, workflow optimization, and more informed decisions. To learn more about how Experian Assistant can transform your data analytics capabilities, watch our recent tech showcase and book a demo with your local Experian sales team. Watch tech showcase Learn more

This series will explore our monthly State of the Economy report, which provides a snapshot of the top monthly economic and credit data for financial service professionals to proactively shape their business strategies. The U.S. economy remains on solid footing, as GDP grew at a healthy 2.8% rate in Q3, driven by consumer spending. Alongside growth, inflation ticked up, while the labor market eased across several measures. In response to these developments, the Federal Reserve announced a quarter-point cut in November, with another cut penciled in for December. The November State of the Economy report fills in the rest of the macroeconomic story. This month’s highlights include: Annual headline inflation ticked up from 2.4% to 2.6%. 12,000 jobs were added in October, amid hurricane and strike impacts. Retail sales increased by 0.4% in October. Check out the full report for a detailed analysis of the rest of this month’s data, including the latest trends in originations, job openings, and growth. Download November's report As our economy continues to fluctuate, it’s critical to stay updated on the latest developments. Subscribe to our new series, The Macro Moment, for economic commentary from Experian NA’s Chief Economist, Joseph Mayans, with additional economic resources, including our new Election Eve’s Scenario Forecasts report. For more economic trends and market insights, visit Experian Edge.

We are squarely in the holiday shopping season. From the flurry of promotional emails to the endless shopping lists, there are many to-dos and even more opportunities for financial institutions at this time of year. The holiday shopping season is not just a peak period for consumer spending; it’s also a critical time for financial institutions to strategize, innovate, and drive value. According to the National Retail Federation, U.S. holiday retail sales are projected to approach $1 trillion in 2024, , and with an ever-evolving consumer behavior landscape, financial institutions need actionable strategies to stand out, secure loyalty, and drive growth during this period of heightened spending. Download our playbook: "How to prepare for the Holiday Shopping Season" Here’s how financial institutions can capitalize on the holiday shopping season, including key insights, actionable strategies, and data-backed trends. 1. Understand the holiday shopping landscape Key stats to consider: U.S. consumers spent $210 billion online during the 2022 holiday season, according to Adobe Analytics, marking a 3.5% increase from 2021. Experian data reveals that 31% of all holiday purchases in 2022 occurred in October, highlighting the extended shopping season. Cyber Week accounted for just 8% of total holiday spending, according to Experian’s Holiday Spending Trends and Insights Report, emphasizing the importance of a broad, season-long strategy. What this means for financial institutions: Timing is crucial. Your campaigns are already underway if you get an early start, and it’s critical to sustain them through December. Focus beyond Cyber Week. Develop long-term engagement strategies to capture spending throughout the season. 2. Leverage Gen Z’s growing spending power With an estimated $360 billion in disposable income, according to Bloomberg, Gen Z is a powerful force in the holiday market​. This generation values personalized, seamless experiences and is highly active online. Strategies to capture Gen Z: Offer digital-first solutions that enhance the holiday shopping journey, such as interactive portals or AI-powered customer support. Provide loyalty incentives tailored to this demographic, like cash-back rewards or exclusive access to services. Learn more about Gen Z in our State of Gen Z Report. To learn more about all generations' projected consumer spending, read new insights from Experian here, including 45% of Gen X and 52% of Boomers expect their spending to remain consistent with last year. 3. Optimize pre-holiday strategies Portfolio Review: Assess consumer behavior trends and adjust risk models to align with changing economic conditions. Identify opportunities to engage dormant accounts or offer tailored credit lines to existing customers. Actionable tactics: Expand offerings. Position your products and services with promotional campaigns targeting high-value segments. Personalize experiences. Use advanced analytics to segment clients and craft offers that resonate with their holiday needs or anticipate their possible post-holiday needs. 4. Ensure top-of-mind awareness During the holiday shopping season, competition to be the “top of wallet” is fierce. Experian’s data shows that 58% of high spenders shop evenly across the season, while 31% of average spenders do most of their shopping in December​. Strategies for success: Early engagement: Launch educational campaigns to empower credit education and identity protection during this period of increased transactions. Loyalty programs: Offer incentives, such as discounts or rewards, that encourage repeat engagement during the season. Omnichannel presence: Utilize digital, email, and event marketing to maintain visibility across platforms. 5. Combat fraud with multi-layered strategies The holiday shopping season sees an increase in fraud, with card testing being the number one attack vector in the U.S. according to Experian’s 2024 Identity and Fraud Study. Fraudulent activity such as identity theft and synthetic IDs can also escalate​. Fight tomorrow’s fraud today: Identity verification: Use advanced fraud detection tools, like Experian’s Ascend Fraud Sandbox, to validate accounts in real-time. Monitor dormant accounts: Watch these accounts with caution and assess for potential fraud risk. Strengthen cybersecurity: Implement multi-layered strategies, including behavioral analytics and artificial intelligence (AI), to reduce vulnerabilities. 6. Post-holiday follow-up: retain and manage risk Once the holiday rush is over, the focus shifts to managing potential payment stress and fostering long-term relationships. Post-holiday strategies: Debt monitoring: Keep an eye on debt-to-income and debt-to-limit ratios to identify clients at risk of defaulting. Customer support: Offer tailored assistance programs for clients showing signs of financial stress, preserving goodwill and loyalty. Fraud checks: Watch for first-party fraud and unusual return patterns, which can spike in January. 7. Anticipate consumer trends in the New Year The aftermath of the holidays often reveals deeper insights into consumer health: Rising credit balances: January often sees an uptick in outstanding balances, highlighting the need for proactive credit management. Shifts in spending behavior: According to McKinsey, consumers are increasingly cautious post-holiday, favoring savings and value-based spending. What this means for financial institutions: Align with clients’ needs for financial flexibility. The holiday shopping season is a time that demands precise planning and execution. Financial institutions can maximize their impact during this critical period by starting early, leveraging advanced analytics, and maintaining a strong focus on fraud prevention. And remember, success in the holiday season extends beyond December. Building strong relationships and managing risk ensures a smooth transition into the new year, setting the stage for continued growth. Ready to optimize your strategy? Contact us for tailored recommendations during the holiday season and beyond. Download the Holiday Shopping Season Playbook

 Technology has dramatically transformed the financial services landscape, fostering innovation and enhancing operational efficiency. In an interview at this year’s Money20/20 conference, Scott Brown, Group President of Financial and Marketing Services for Experian, sat down with Fintech Futures’ North America Correspondent Heather Sugg to share how Experian is leveraging data, analytics, and artificial intelligence (AI) to modernize the financial services industry. During the discussion, Scott highlighted the recent launch of Experian Assistant — our newest generative AI tool designed to accelerate the modeling lifecycle, resulting in greater productivity, improved data visibility, and reduced delays and expenses. While Experian Assistant is a business-to-business solution built alongside our clients, Scott also noted its broader impact — helping increase credit access for underserved consumers. “At Experian, we’re really focused on addressing the underserved community who doesn’t have access to credit,” said Scott. “And we think that this tool helps lenders reach those customers in an easier way.”  Learn more about Experian Assistant and watch our tech showcase to see the solution in action. Learn more Watch tech showcase

Do you know where your customers stand? Not literally, of course, but do you know how recent macroeconomic changes and their personal circumstances are currently affecting your portfolio? While refreshing your customers’ credit data quarterly works for some aspects of portfolio management, you need more frequent access to fresh data to quickly respond to risky customer behavior and new credit needs before your portfolio takes a hit. Use triggers to improve portfolio management Event-based credit triggers provide daily or real-time alerts about important changes in your customers’ financial situations. You can use these to manage risk by promptly responding to signs of changing creditworthiness or to prevent attrition by proactively reaching out to customers who are shopping for credit. Risk Triggers℠ and Retention Triggers℠ offer a real-time solution that can be customized to fit your needs for daily portfolio management. What are Risk Triggers? Experian’s Risk Triggers alert you of notable information, such as unfavorable utilization rate changes, delinquencies with other lenders and recent activity with high-interest, short-term loan products. This solution allows you to monitor how your customers manage accounts with other lenders to get ahead of potential risk on your book. You can use Risk Triggers to get daily insights into your customers’ activity — allowing you to quickly identify potentially risky behavior and take appropriate action to limit your exposure and losses. Types of Risk Triggers Choose from a defined Risk Triggers package that could help you identify high-risk customers, including: New trades Increasing credit utilization or balances over limit New collection accounts An account is charged-off A credit grantor closes an account New delinquency statuses (30 to 180 days past due) Consumers seeking access to short-term, high-risk financing options Bankruptcy and deceased events How to use Risk Triggers You can use the daily alerts from Risk Triggers to help inform your account management strategy. Depending on the circumstances, you might: Decrease credit limits Close or freeze accounts Accelerate payment requests Continue monitoring accounts for other signs of risk Spotlight on Experian’s Clarity Services events Included in Risk Triggers are events from Experian’s Clarity Services, which draw on expanded FCRA-regulated data* from a leading source of alternative financial credit data.  For example, you could get an alert when someone has a new inquiry from non-traditional loans. These triggers provide a broader view of the customer – offering added protection against risky behavior. What are Retention Triggers? Experian’s Retention Triggers can alert you when a customer improves their creditworthiness, is shopping for new credit, opens a new tradeline or lists property. Proactively responding to these daily alerts can help you retain and strengthen relationships with your customers — which is often less expensive than acquiring new customers. Types of Retention Triggers Choose from over 100 Retention Triggers to bundle, including: New trades New inquiries Credit line increases Property listing statuses Improving delinquency status Past-due accounts are brought current or paid off How to use Retention Triggers You can use Retention Triggers to increase lifetime customer value by proactively responding to your customers’ needs and wants. You might: Increase credit limits Offer promotional financing, such as balance transfers Introduce perks or rewards to strengthen the relationship Append attributes for improved decisioning  By appending credit attributes to Risk and Retention Trigger outputs, you can gain greater insight into your accounts.  Premier AttributesSM is Experian's core set of 2,100-plus attributes. These can quickly summarize data from consumers' credit reports, allowing you to more easily segment accounts to make more strategic decisions across your portfolio.  Trended 3DTM attributes can help you spot and understand patterns in a customer's behavior over time. Integrating trended attributes into a triggers program can help you identify risk and determine the next best action. Trended 3D includes more than 2,000 attributes and provides insights into industries such as bankcard, mortgage, student loans, personal loans, collections and much more.  By working with both triggers and attributes, you'll proactively review an account, so you can then take the next best action to improve your portfolio's profits. Customize your trigger strategy When you partner with Experian, you can bundle and choose from hundreds of Risk and Retention Triggers to focus on risk, customer retention or both. Additionally, you can work with Experian’s experts to customize your trigger strategy to minimize costs and filter out repetitive or unneeded triggers: Use cool-off periods Set triggering thresholds Choose which triggers to monitor Establish hierarchies for which triggers to prioritize Create different strategies for segments of your portfolio Learn more about Risk and Retention Triggers. Learn more *Disclaimer: “Alternative Financial Credit Data” refers to the use of alternative data and its appropriate use in consumer credit lending decisions, as regulated by the Fair Credit Reporting Act. Hence, the term “Expanded FCRA-Regulated Data” may also apply in this instance, and both can be used interchangeably.

The open banking revolution is transforming the financial services landscape, offering banks and financial institutions unprecedented access to consumer-permissioned data. However, during our recent webinar, “Navigating Open Banking: Strategies for Banks and Financial Institutions,” over 78% of attendees stated that they do not currently have an open banking strategy in place. This highlights a significant gap in the industry. By tapping into consumer-permissioned data, you can develop more personalized products, streamline credit decisioning, and improve overall customer engagement. With the right strategies, open banking offers a pathway to growth, innovation, and enhanced customer experiences. Here’s a snippet from the webinar’s Q&A session with Ashley Knight, Senior Vice President of Product Management, who shared her perspective on open banking trends and opportunities. Q: What specific analytic skill is the most important when working on open banking data?A: The ability to parse and transform raw data, a deep understanding of data mining, experience in credit risk, and general modeling skills to improve underwriting. Q: What lessons did the U.S. learn from the experience of other countries that implemented open banking? A: The use cases are common globally; typical uses of open banking data include second-chance underwriting to help score more consumers and customer management, which involves assessing cashflow data to leverage on an existing portfolio (first-party data). This can be used in various ways, such as cross-sell, up-sell, credit line increase, and growing/retaining deposits. Q: Does Experian have access to all a consumer’s bank accounts in cases where the consumer has multiple accounts?A: Data access is always driven by consumer permission unless the organization owns this data (i.e., first-party data). Where first-party data is unavailable, we collect it through clients or lenders who send it to us directly, having gained the proper consent. Yes, we can intake data from multiple accounts and provide a categorization and attribute calculation. Q: Where does the cashflow data come from? Is it only credit card spending?A: It includes all spending data from bank accounts, checking accounts, credit cards, savings, debit cards, etc. All of this can be categorized, and we can calculate attributes and/or scores based on that data. Q: What is the coverage of Experian’s cashflow data, and how is it distributed across risk bands?A: Cashflow data moves through Experian directly from consumer permissioning for B2B use cases or from institutions with first-party data. We perform analytics and calculate attributes on that portfolio. Don’t miss the chance to learn from our industry leaders on how to navigate the complexities of open banking. Whether you are a seasoned professional or just starting to explore its potential, this webinar will equip you with the knowledge you need to stay ahead. Watch on-demand recording Learn more Meet our expert Ashley Knight, Senior VP of Product Management, Experian Ashley leads our product management team focusing on alternative data, scores, and open banking. She fosters innovation and drives financial inclusion by using new data, such as cash flow, analytics, and Experian’s deep expertise in credit.

This series will explore our monthly State of the Economy report, which provides a snapshot of the top monthly economic and credit data for financial service professionals to proactively shape their business strategies. After the Federal Reserve announced its first cut since 2020 in September, several pieces of economic data have surpassed expectations. Job creation was almost double economists’ estimates, unemployment ticked down, and personal incomes were revised up. Alongside these areas of strength, inflation continued to prove stubborn. The October State of the Economy report fills in the rest of the developing macroeconomic story. This month’s highlights include:  Unemployment decreased for the second month in a row, down to 4.1%. Core inflation increased from 3.2% to 3.3%, driven by shelter and service costs. Negative rental payment activity has declined 1.9% over the past year. Check out our report for a detailed analysis of the rest of this month’s data, including the latest trends in originations, retail sales, and consumer sentiment. Download October's report As our economy continues to fluctuate, it's critical to stay updated on the latest developments. Subscribe to our new series, The Macro Moment, for economic commentary from Experian NA’s Chief Economist, Joseph Mayans, with additional economic resources, including our new Lending Conditions Chartbook and our new Labor Market Monitor. For more economic trends and market insights, visit Experian Edge.

In today’s digital age, call center fraud is a growing threat that businesses can no longer afford to ignore. As fraudsters become increasingly sophisticated, it’s crucial for companies to implement robust security measures to protect both their operations and their consumers. Various forms of call center fraud can have a significant impact on businesses. To prevent this, companies can use effective strategies including multifactor authentication solutions and account takeover prevention techniques. But first, what is call center fraud? Understanding call center fraud Call center fraud occurs when fraudsters exploit vulnerabilities in customer service operations to gain unauthorized access to sensitive information and commit identity theft. This type of fraud can take many forms, including social engineering, which occurs when a fraudster manipulates a call center agent into providing information or access, and phishing, which occurs when fraudsters use deceptive tactics to obtain confidential details from unsuspecting individuals. One of the most concerning tactics used by fraudsters is impersonation, or pretending to be legitimate consumers to gain access to accounts. Once they have access, they can make unauthorized transactions, change account details, or even take over the account entirely—a scenario known as an account takeover. The impact of these fraudulent activities can be devastating, leading to significant financial losses, damage to brand reputation, and a loss of consumer trust. Key strategies for preventing call center fraud According to recent research, account takeover fraud has increased by 330% in the past two years, projecting to cost $6.24 billion globally.[1] In addition, the number of U.S. consumers who have experienced account takeover has increased from 22% in 2021 to 29% in 2023.[2] To effectively combat call center fraud, businesses must adopt a multi-layered approach that includes advanced technological solutions, comprehensive employee training, and real-time monitoring. Here are some of the most effective strategies: 1. Implementing multifactor authentication (MFA) solutions One of the most effective ways to secure consumer interactions is by implementing multifactor authentication (MFA) solutions. MFA requires users to provide two or more verification factors to gain access to an account or complete a transaction. This adds an extra layer of security, making it significantly more difficult for fraudsters to succeed even if they have obtained some of the consumer’s information. MFA can be integrated into call center operations in several ways. For example, businesses can use voice recognition as a biometric factor, requiring consumers to verify their identity through a unique voiceprint. Other methods include sending a one-time code via text message, which the consumer must provide during the call, or using mobile app verification, where consumers approve transactions directly through their smartphones. 2. Account takeover prevention Account takeover is one of the most serious threats to call centers, as they involve fraudsters gaining control of a consumer’s account, often with disastrous consequences. To prevent account takeover, businesses can employ a combination of technological solutions and best practices. First, understanding what account takeover entails is crucial. It typically begins when a fraudster obtains some of the consumer’s personal information—often through phishing, social engineering, or a data breach. They then use this information to impersonate the consumer and convince call center agents to provide them with access to the account. To combat this, businesses can employ several account takeover prevention techniques. Anomaly detection systems can flag unusual activities, such as login attempts from unfamiliar locations or devices, prompting additional verification steps. Behavioral biometrics is another powerful tool, analyzing patterns in how users interact with their devices to detect inconsistencies that may indicate fraud. Continuous authentication, where the system continuously verifies the user’s identity throughout the session, is also effective in catching fraudsters in the act. 3. Training and awareness Technology alone may not be enough to entirely prevent call center fraud—human factors are equally important. Regular training for call center staff is essential to ensure team members can recognize and respond to potential fraud attempts. Employees should be trained to identify common tactics used by fraudsters, such as social engineering, and to follow strict verification procedures before providing any sensitive information. Awareness campaigns can also play a significant role in preventing fraud. Internally, companies should run regular campaigns to remind employees of the importance of adhering to security protocols. Externally, educating consumers about the risks of fraud and encouraging them to use security features like MFA can help reduce the likelihood of successful attacks. 4. Real-time monitoring and analytics Real-time monitoring is a critical component of an effective fraud prevention strategy. By continuously monitoring calls and transactions, businesses can quickly identify and respond to suspicious activities before they escalate. Advanced analytics tools, including voice analytics and behavior analysis, can provide valuable insights into potential fraud, allowing companies to take proactive measures. Voice analytics, for instance, can detect stress or hesitation in a caller’s voice, which may indicate that they are not who they claim to be. Behavior analysis can track how consumers typically interact with their accounts, flagging deviations from the norm as potential fraud. Continuous improvement is key here—regularly reviewing and updating monitoring protocols ensures that businesses stay ahead of evolving threats. Preventing call center fraud in your business By using a multi-layered fraud approach through a variety of authentication solutions, your business can quickly detect call center fraud without disrupting your consumers’ experience. Identify the risk Identity-based risk detection can pinpoint when a specific identity may be in the hands of fraudsters. Device intelligence solutions can recognize the risk associated with a specific device used to attempt online access. Address the risk Knowledge-based authentication (KBA) can quickly authenticate users by asking questions only they can answer, which can deter fraudsters. MFA services can generate and deliver a one-time password to a consumer’s mobile device to verify their identity in real time. Document verification allows your business to collect and verify images of identity documents uploaded from a consumer’s mobile device. Protect your business and your consumers from call center fraud Call center fraud is a significant threat that requires a proactive and comprehensive approach to prevention. By implementing strategies such as multifactor authentication solutions, account takeover prevention techniques, and robust employee training, businesses can significantly reduce their risk of falling victim to fraud. In today’s fast-paced digital world, staying vigilant and proactive is the key to safeguarding your call center against fraud. Act now to protect your business and maintain the trust of your consumers. Enable your call center to detect risk quickly and effectively with our robust fraud prevention solutions. Get started Download our identity and fraud report This article includes content created by an AI language model and is intended to provide general information. [1] Worldmetrics.org, Account Takeover Statistics: Losses to Reach $6.24 Billion Globally, 2024. [2] Security.org, Account Takeover Incidents are Rising: How to Protect Yourself in 2024.

This series will explore our monthly State of the Economy report, which provides a snapshot of the top monthly economic and credit data for financial service professionals to proactively shape their business strategies. During their September meeting, the Federal Reserve made a highly-anticipated announcement to cut rates for the first time since 2020. Fed officials cut rates by 50bps, while also penciling in an additional 50bps of cuts for 2024 and 100bps of cuts in 2025 in their Summary of Economic Projections. While rates are coming down and inflation continues to cool, there were downward revisions to job creation made in August and declining job openings in July. Data highlights from this month’s report include: The Federal Reserve announced a 50bps rate cut during the September meeting. Annual headline inflation cooled from 2.9% to 2.5%, getting closer to the Fed’s 2% goal. Mortgage originations increased 7.0% in August. Check out our report for a deep dive into the rest of this month’s data, including the latest trends in job creation, retail sales, and consumer sentiment. Download September's report As our economy continues to fluctuate, it's critical to stay updated on the latest developments. Subscribe to our new series, The Macro Moment, for economic commentary from Experian North America's Chief Economist, Joseph Mayans, and download our new Lending Conditions Chartbook for additional insights. For more economic trends and market insights, visit Experian Edge.

Effective collection strategies are critical for the financial health of credit unions. Unlike traditional banks, credit unions often emphasize member relationships and community values, making the collection process more tactful. Crafting a strategy that balances the need for financial stability with member-centric values is essential.  Here’s a step-by-step guide on how to create an effective credit union collection strategy. 1. Understand your members The foundation of an effective credit union collection strategy is understanding your members. Credit unions often serve specific communities or groups, and members may face unique financial challenges. By analyzing member demographics, financial behavior, and common reasons for delinquency, you can tailor your approach to be more vigilant and effective. Segment members: Group members based on factors like loan type, payment history, and financial behavior. This allows for targeted communications and outreach strategies. Member communication preferences: Determine how your members prefer to be contacted—whether by phone, email, or in person. This can increase engagement and responsiveness. 2. Prioritize compliance Compliance with regulations is non-negotiable in the collections process. Ensure that your strategy adheres to all relevant laws and guidelines. Fair Debt Collection Practices Act (FDCPA): Ensure that your team is fully trained on the FDCPA and that your practices comply with its requirements. State and local regulations: Be aware of any state or local regulations that may impact your collections process. This could include restrictions on contact methods or times. Internal audits: Regularly conduct internal audits to ensure compliance and identify any areas of risk. 3. Leverage technology for efficiency Technology can streamline the collection process, making it more efficient and a better member experience. Automated reminders: Use automated systems to send reminders before and after payment due dates. This reduces the likelihood of missed payments due to forgetfulness. Data analytics: Use data analytics to identify trends in member behavior, establish a collections prioritization strategy, and predict potential delinquencies. This allows your team to be proactive rather than reactive. Digital communication channels: Implement digital communication options, such as text messages or chatbots to make it easier for members to interact with the credit union. 4. Establish clear communication protocols Early and frequent communication is key to preventing delinquency and managing it when it occurs. Create clear protocols for member communication that prioritize empathy and treatment plans over demands. Early intervention: Reach out to members as soon as they miss a payment. Early intervention can prevent minor issues from escalating. Consistent communication: Ensure that your communication is consistent across all channels. Whether a member receives a call, an email, or a letter, the message should be clear and aligned with the credit union’s values. Human understanding: Train your collections team to use a compassionate tone. Members are more likely to respond positively when they feel understood and respected. 5. Offer flexible payment solutions Flexibility is crucial when working with members who are struggling financially. Offering a range of payment solutions can help members stay on track and reduce the likelihood of default. Customized treatment plans: Offer customizable payment plans that fit the member’s financial situation. This could include lower payments over a longer term or temporary payment deferrals. Loan modifications: In some cases, modifying the terms of the loan—such as extending the repayment period or lowering the interest rate—may be necessary to help the member succeed. Debt consolidation options: If a member has multiple loans, consider offering debt consolidation to simplify their payments and reduce their overall financial burden. 6. Train your collection team Your collection team is the frontline of your strategy. Providing them with the right training and tools is essential for success. Ongoing training: Regularly update your team on the latest regulations, best practices, and communication techniques. This keeps them informed and prepared to handle various situations. Better decision making: Empower your team to make decisions that align with the credit union’s values. This could include offering payment extensions or waiving late fees in certain situations. Regular support: Working in collections can be complex. Provide resources and support to help your team manage stress and maintain a positive attitude. 7. Monitor and adjust your strategy A successful credit union collection strategy is dynamic. Regularly monitor its performance and adjust as needed. Key performance indicators (KPIs): Track KPIs such as delinquency rates, recovery rates, roll-rates and member satisfaction to gauge the effectiveness of your strategy. Member feedback: Survey members who have gone through the collections process. Their insights can help you identify areas for improvement. Continuous improvement: Use data and feedback to continuously refine your strategy. What worked last year may not be as effective today, so staying adaptable is key. Creating an effective credit union collections strategy requires a balance of empathy, effective communication, and compliance. By understanding your members, communicating clearly, offering flexible solutions, leveraging technology, and continuously improving your approach, you can develop a strategy that not only reduces delinquency but also strengthens member relationships. In today’s fiercely competitive landscape, where efficiency and efficacy stand paramount, working with the right partner equipped with innovative credit union solutions can dramatically transform your outcomes. Choosing us for your debt collection needs signifies an investment in premier analytics, advanced debt recovery tools, and unmatched support.  Learn more Watch credit union collection chat This article includes content created by an AI language model and is intended to provide general information.

In this article...What is reject inference? How can reject inference enhance underwriting? Techniques in reject inference Enhancing reject inference design for better classification How Experian can assist with reject inference  In the lending world, making precise underwriting decisions is key to minimizing risks and optimizing returns. One valuable yet often overlooked technique that can significantly enhance your credit underwriting process is reject inferencing. This blog post offers insights into what reject inference is, how it can improve underwriting, and various reject inference methods.  What is reject inference?  Reject inference is a statistical method used to predict the potential performance of applicants who were rejected for a loan or credit — or approved but did not book. In essence, it helps lenders and financial institutions gauge how rejected or non-booked applicants might have performed had they been accepted or booked. By incorporating reject inference, you gain a more comprehensive view of the applicant pool, which leads to more informed underwriting decisions.  Utilizing reject inference helps reduce biases in your models, as decisions are based on a complete set of data, including those who were initially rejected. This technique is crucial for refining credit risk models, leading to more accurate predictions and improved financial outcomes.  How can reject inference enhance underwriting?  Incorporating reject inference into your underwriting process offers several advantages:  Identifying high-potential customers: By understanding the potential behavior of rejected applicants, you can uncover high-potential customers who might have been overlooked before.  Improved risk assessment: Considering the full spectrum of applicants provides a clearer picture of the overall risk landscape, allowing for more informed lending decisions. This can help reduce default rates and enhance portfolio performance.  Optimizing credit decisioning models: Including inferred data from rejected and non-booked applicants makes your credit scoring models more representative of the entire applicant population. This results in more robust and reliable predictions.  Techniques in reject inference  Several techniques are employed in reject inference, each with unique strengths and applications. Understanding these techniques is crucial for effectively implementing reject inference in your underwriting process. Let's discuss three commonly used techniques:  Parceling: This technique involves segmenting rejected applicants based on their characteristics and behaviors, creating a more detailed view of the applicant pool for more precise predictions.  Augmentation: This method adds inferred data to the dataset of approved applicants, producing a more comprehensive model that includes both approved and inferred rejected applicants, leading to better predictions.  Reweighting: This technique adjusts the weights of approved applicants to reflect the characteristics of rejected applicants, minimizing bias towards the approved applicants and improving prediction accuracy.  Pre-diction method  The pre-diction method is a common approach in reject inference that uses data collected at the time of application to predict the performance of rejected applicants. The advantage of this method is its reliance on real-time data, making it highly relevant and current.  For example, pre-diction data can include credit bureau attributes from the time of application. This method helps develop a model that predicts the outcomes of rejected applicants based on performance data from approved applicants. However, it may not capture long-term trends and could be less effective for applicants with unique characteristics.  Post-diction method  The post-diction method uses data collected after the performance window to predict the performance of rejected applicants. Leveraging historical data, this method is ideal for capturing long-term trends and behaviors.  Post-diction data may include credit bureau attributes from the end of the performance window. This method helps develop a model based on historical performance data, which is beneficial for applicants with unique characteristics and can lead to higher performance metrics. However, it may be less timely and require more complex data processing compared to pre-diction.  Enhancing reject inference design for better classification  To optimize your reject inference design, focus on creating a model that accurately classifies the performance of rejected and non-booked applicants. Utilize a combination of pre-diction and post-diction data to capture both real-time and historical trends.  Start by developing a parceling model using pre-diction data, such as credit bureau attributes from the time of application, to predict rejected applicants' outcomes. Regularly update your model with the latest data to maintain its relevance.  Next, incorporate post-diction data, including attributes from the end of the performance window, to capture long-term trends. Combining both data types will result in a more comprehensive model.  Consider leveraging advanced analytics techniques like machine learning and artificial intelligence to refine your model further, identifying hidden patterns and relationships for more accurate predictions. How Experian can assist with reject inference  Reject inference is a powerful tool for enhancing your underwriting process. By predicting the potential performance of rejected and non-booked applicants, you can make more inclusive and accurate decisions, leading to improved risk assessment and optimized credit scoring models.  Experian offers various services and solutions to help financial institutions and lenders effectively implement reject inference into their decisioning strategy. Our solutions include comprehensive and high-quality datasets, which empower you to build models that are more representative of the entire applicant population. Additionally, our advanced analytics tools simplify data analysis and model development, enabling you to implement reject inference efficiently without extensive technical expertise.  Ready to elevate your underwriting process? Contact us today to learn more about our suite of advanced analytics solutions or hear what our experts have to say in this webinar.  Watch Webinar Learn More This article includes content created by an AI language model and is intended to provide general information. 

Replay attacks may threaten your customers’ online security Today, consumer online security is more important than ever. This year, the FTC has already received nearly six million reports of fraud, and 1.4 million of those cases were specifically identity theft.[1] In addition, a recent study reported that losses due to identity fraud amounted to almost $23 billion in 2023.[2] And consumers aren’t the only ones at risk. According to CyberArk’s global research report, 93% of organizations had two or more identity-related breaches in the past year.[3] This means it’s not only up to consumers to protect themselves against identity theft. It’s also up to businesses to protect themselves and their customers from the threat of fraud. As security technology advances, so do the tactics of hackers attempting to steal information such as usernames, account numbers, and passwords from innocent online users. One method that hackers use to obtain this information is called a replay attack, which can pose a serious threat to your customers’ online security. What is a replay attack? A replay attack is a network-based security hack in which a hacker intercepts legitimate data transmission and then fraudulently repeats it to gain access to a network or system. These attacks are designed to fool the victim into believing the hacker is a genuine user, and they happen in three steps: Eavesdropping: The hacker listens in on secure network communications, such as information sent through a Virtual Private Network (VPN), to learn about the activity happening on that network. Interception: The hacker intercepts legitimate user information – usernames, user activity, computer specs, passwords, etc. Replay: The hacker illegally resends (or “replays”) the valid information they gathered to trick the receiver into thinking that they are a genuine user. Here’s an example: John transfers funds from one online banking account to another. A hacker illegally captures that transaction message (which is often accompanied by a digital signature or token) and “replays” that same transaction message multiple times to trigger additional fund transfers, all without the genuine user’s knowledge or permission. The bank doesn’t recognize a problem because the “replayed” transaction messages includes the legitimate digital signature/token, so the bank approves the additional transfers. Replay attacks aren’t just used for banking transactions. They can be used for various activities, such as: Internet of Things (IoT) device attacks: IoT devices include a multitude of “smart home” devices such as smart plugs, cameras, locks, appliances, speakers, lights, and more. Vulnerabilities in these devices can allow hackers to replicate commands to these devices that seem legitimate, such as turning on cameras, unlocking doors, and disabling security systems.[4] Remote keyless entry systems for vehicles: Most vehicles use a remote key fob to lock and unlock the doors. This key fob usually uses radio waves to send the lock/unlock signal to the car. Hackers can use a device to receive and transmit radio waves near a person’s vehicle that mimic that same lock/unlock signal, and then “replay” that signal to unlock the person’s car themselves.[5] Text-dependent speaker verification: Some people use voice recognition to verify their identity when accessing an account or system. Hackers can record a person’s voice when the person speaks to verify their identity, and then “replay” that voice recording to fraudulently access the account.[6] How to prevent replay attacks Replay attacks are dangerous because they are often unnoticed or overlooked until the damage has already been done. Fortunately, there are ways to stop hackers from using replay attacks to access your customers’ personal information. Device intelligence: By leveraging unique intelligence about the device being used, replay attacks can be thwarted even when fraudsters are using authentic, but stolen, information. Time stamping: By forcing a timestamp on all sent and received messages, you can prevent hackers from sending repeated messages with legitimate information obtained illegally. Geolocation review: By identifying suspicious language and/or time zones, you can compare access routes to confirm customers are authentic and secure. Why it matters for your business Consumers in the U.S. value network security more than ever, with 70% rating security a top priority, even over personalization and convenience.[7] People want to feel safe online, and if they experience a threat of identity theft or fraud, they’ll need to find a reliable resource to keep their personal information secure. Successful replay attacks allow fraudsters to impersonate real users and potentially gain partial or full access to their personal online accounts. If your customers fall victim to these kinds of attacks, the resulting stress may have a negative impact on your relationship with them. With our fraud management solutions, your business can strengthen your customers’ trust and security by leveraging highly trained fraud analysts to help uncover suspicious activity that might not be noticed otherwise. Lower fraud losses and achieve fraud capture rates that exceed industry averages. Protect your customers by using a covert, frictionless solution the reduces false positives. Improve operational efficiency by prioritizing resources across the board. Protect your consumers with powerful fraud management solutions 63% of consumers say it’s important for businesses to be able to recognize them online, and 81% say they are more trusting of businesses that can accomplish easy and accurate identification.[8] While replay attacks can cause consumers stress and anxiety, taking action to prevent them can fortify a strong, trusting relationship between your business and your customers. Protect your customers and prevent replay attacks with our powerful fraud management solutions. Get started [1] IdentityTheft.org, 2024 Identity Theft Facts and Statistics. [2] Javelin, 2024 Identity Fraud Study: Resolving the Shattered Identity Crisis. [3] CyberArk, Report: 93% of Organizations Had Two or More Identity-Related Breaches in the Past Year, May 2024. [4] Hackster.io, IoT Devices May Be Susceptible to Replay Attacks with a Raspberry Pi and RTL-SDR Dongle, 2017. [5] Automotive World, How to mitigate vulnerabilities in keyless entry systems, 2023. [6] Antispoofing, Audio Replay Attacks and Countermeasures Against Them, 2022. [7] 2018 Experian® Global Fraud Report [8] Experian® 2024 Identity and Fraud Report Highlights Evolving Fraud Landscape This article includes content created by an AI language model and is intended to provide general information.

This series will dive into our monthly State of the Economy report, providing a snapshot of the top monthly economic and credit data for those in financial services to proactively shape their business strategies. The labor market has been a source of strength for the U.S. economy coming out of the pandemic, providing workers with stable employment and solid wages. However, the labor market has slowed in recent months, with lower-than-expected job creation and rising unemployment, causing weakening sentiment in the broader market. This has resulted in increased pressure on the Federal Reserve to begin cutting rates and places more importance on the incoming data between now and the September FOMC meeting. Data highlights from this month’s report include: Job creation declined in July, falling short of economists’ expectations. Unemployment increased from 4.1% to 4.3%. Inflation cooled again in July, with annual headline inflation easing from 3.0% to 2.9%. GDP picked up in Q2 to 2.8%, primarily driven by strong consumer spending. Check out our report for a deep dive into the rest of this month’s data, including the latest trends in originations, retail sales, and the new housing market. Download August's report To have a holistic view of our current environment, it’s important to view the economy from different angles and through different lenses. Download our latest macroeconomic forecasting report for our views on what's to come in the U.S. economy and listen to our latest Econ to Action podcast. For more economic trends and market insights, visit Experian Edge.