EXPERT FORECAST : BANKING AND FINANCE
HOW TO PROTECT YOUR BUSINESS FROM THE RISING THREAT OF IDENTITY FRAUD
In 2022 identity fraud skyrocketed – especially during the festive period . Eduardo Castro , Managing Director , Identity and Fraud at Experian , explores actions businesses can take to safeguard customers .
Since 2018 , identity fraud has been steadily rising during November and December by up to 15 % year-onyear as fraudsters take advantage of the increase in online transactions during peak shopping season .
Compounding the problem further this year are challenging economic conditions which tend to also increase fraudulent activity . Indeed , Experian ’ s identity and fraud technology prevented more than £ 1.8 billion of fraudulent transactions in 2021 , showing the potential financial cost fraud poses to businesses .
So , what steps can you take to minimise the risk of falling victim to fraud while also protecting your customers ?
Avoid reputational and financial hits
Third-party fraud occurs when a person ’ s identity or personal details are used by fraudsters without consent to access credit . It poses an enormous cost to businesses , who have a responsibility to ensure their customers ’ details are genuine , investigate the fraudulent occurrence and potentially in some cases , refund the defrauded customer . Nearly 70 % of all identity fraud in the UK is classified as third-party fraud according to Experian data .
Not only does identity theft have a cost implication , but a reputational risk too . Identity theft is the top security concern of UK consumers and customers that experience fraud may be discouraged from using that business service in the future . Not to mention the media attention that fraud cases can receive if they have been managed poorly Preventative measures are more successful than reacting after the fact . They protect the customer and businesses from the cost of fraud and any potential reputational damage .
Verify customer information
It is vital for businesses to confirm customers ’ information is legitimate and not a stolen identity . Identity checks and verification systems enable businesses to spot ID fraud by ensuring a customer is whom they say they are , stopping fraud in its tracks . Bolstering fraud defences helps to boost customer confidence , while also ensuring that passive and invisible checks don ’ t inconvenience genuine customers . www . intelligentfin . tech