Banks and other financial institutions are under immense pressure to quickly and effectively protect themselves and their customers from digital banking and payment fraud.
Fremont, CA: In a recent global banking fraud survey, cyber fraud has been cited as a major challenge facing financial institutions today. With billions of stolen dollars entering the pockets of fraudsters every year, banks are losing not only money, but their customers and brand reputations are losing too.
Although digital banking security keeps evolving in response to changing client expectations, technology, and industry trends, fraudsters also continue to adapt their tactics to override these strategies.
Here are four ways to prevent banking and payment frauds:
Verified technology to prevent fraud
The safest option against digital banking and payment fraud is to detect and remove threats before any damage is done. A stratified technique to the prevention of fraud has been found to be remarkably effective in removing phishing and other attacks. The most successful systems rely on a wide range of security features, such as device and browser identification, end-to-end encryption, strong app security, malware detection, and digital transaction signing.
Unfortunately, for banks, they are perfectly positioned to attract inside fraudsters. Research shows that as much as 70percent of banking fraud is attributed to insiders. The theft of bank customer data is of great concern as account details, and PIN codes are sold on the black market. While policies are in place to screen and audit staff, internal fraud can go unnoticed for quite some time. A bank's potential to identify its customers monitor transactions, and alarm about unusual activity in real-time is of significant benefit.
Continued engagement with customers about the risks of fraud is crucial. Feasible views of the risks they face, what to look for, and tips for safe trading are well received. Banks can also gain the trust of their customers by explaining the steps designed to safeguard their customers from fraud. When banks can show that they have promptly secured their digital channels and are continually assessing their options, their customers will feel more at ease.
Messages with meaning
Fraudsters shape their victims' identity, hence it is crucial to confirm the identity of every individual trying to log on to or transact through digital banking. The most credible way to accomplish this is through multi-factor, out-of-band customer authentication, which has proven to be much more impactful than OTPs alone in minimizing different kinds of fraud, such as take-over fraud and man-in-the-medium attacks.