The main fraud challenges facing fintech companies today
To start the discussion, participants shared several key fraud challenges they were currently facing. An executive from an online banking app found the biggest issue to be fraud at the point of payment. Another executive spoke about fraud during the onboarding process and the value of KYC checks. They spoke of the importance of having a frictionless onboarding experience and how SSO was one of the methods used to minimize fraud. But SSO methods require trust and reliance on third party actors.
A participant from an online remittance company shared the difficulties of keeping up to date with changes in beneficiary accounts. A change in the account doesn’t always mean the account is being taken over, and determining what is suspicious and what is not, is tricky.
An executive from another online banking app also spoke about the issues surrounding social engineering. They had seen many fraudsters type in different usernames to see if an individual had an account on a website. If the individual has an account on the website, fraudsters would then use social engineering tactics to obtain login credentials and take over their accounts.
The evolution of the responsibilities of the fraud team
The conversation then moved towards the changing responsibilities of fraud teams. A participant spoke about how the role has changed drastically, such as how the introduction of face ID technology has allowed fraud teams to dedicate more time to difficult fraud cases. Executives also discussed how leveraging machine learning and AI for fraud prevention has been a welcome change. But it’s the combination of machine learning and manual monitoring that is proving most effective.
The future of fintech app fraud prevention
Towards the end of the conversation, participants discussed what the future holds for fraud prevention on fintech apps. An executive spoke about tokenized identity and tokenized payments growing more popular while another spoke about how cross border interactions will change. Many agreed that biometrics would continue to develop, and may even be integrated into KYC.
To round off the discussion, participants agreed that while fraud is evolving, so is technology. And it is with AI and machine learning that organizations can be proactive in the fight against fraud.