In today’s digital world, the biggest fraud threat is having our identities used by criminals for their own financial gain. All at the expense of our financial institutions and at our own expense as well. Preventing application fraud is key to a successful digital fraud strategy.

Nearly every month, a news story about a big security breach, a successful hacking attempt or a significant personal data breach has occurred. Unfortunately, there is a serious risk that this personal data could be used by hackers and fraudsters to impersonate people and commit application fraud.

Despite an increased focus on cyber security and data breach prevention through Information Security Management System programs such as ISO 27001, fraudsters, hackers, and financial criminals continue to challenge data security. They are devising increasingly inventive ways of stealing data and committing financial fraud. Once personal data has been leaked to the internet, unfortunately, there is no way of getting it back. Secondly, there is no way of controlling who will receive it and try to use it.

Fraud affects our everyday lives and costs the banking and financial industry billions of dollars every year. The knock-on effect is that it causes our costs and expenses to increase – for example interest rates, fees, and insurance premiums.

There is an increasingly complex need to balance between reducing fraud, ensuring operational efficiencies, and providing an excellent client experience.

Digital-led experiences will continue to grow in popularity

Companies that act quickly, innovate their delivery model to help consumers navigate the digital onboarding safely and effectively will establish a strong advantage. Creating a good first impression is key in business. For many, this means ensuring digital customer onboarding processes and financial transactions run smoothly – friction free.

Financial institutions invest significantly into fraud prevention programs, including both software solutions and human resources. Customers expect their banks and financial services providers to keep their personal information and their accounts safe. There are several measures organisations should be implementing. These measures will safeguard their customers’ identities and prevent fraudsters and criminals from perpetrating application fraud.

One of these measures is the use of an innovative application fraud solution that protects an organisation against emerging and ever-changing fraud threats through undertaking fraud risk assessments and ensuring the organisation’s fraud framework is comprehensive and up to date with global best-practice standards. Additionally, given the dynamic nature of fraud, it’s important to have a program in place with its components continuously assessed for ongoing improvements.

Components in a successful application fraud solution

1. Use an organisation that understands application fraud and has a pedigree in working with global clients. Therefore, ensure a comprehensive application fraud solution and reduce fraud losses.
2. Increased focus on preventing financial crime. This ensures a financial crime framework that enables the prevention of enterprise fraud and regulatory compliance on one platform. The platform needs the ability to be implemented on premise or in the Cloud and be scalable.
3. Quick Return on Investment is key. So, use a company that has an excellent track record in implementing application fraud solutions that has significant in-built strategies. This results in a faster implementation project and quick results.
4. The solution must be future proof using the latest technology, a dynamic rules engine, . It must be scalable and use machine learning models to enhance fraud strategies and reduce losses.

Implement a comprehensive application fraud solution that offers:

A flexible input data model – input layouts configured using all the data elements available. Including application and transaction data, credit bureau data, existing customer data, reference data and channel data. Also, a possibility to add results from any external service the business would like to use in their fraud strategies

Incorporates risk scoring with supervised and unsupervised machine learning

A flexible Rules engine with a library of relevant rules and configuration for the business users. Therefore, using a user-friendly rule definition screen, without the need to have any programming knowledge.

Ability to automate the alerts and queue management to ensure efficient decisioning and comprehensive case management.

Comprehensive suite of dashboards and reports for efficient managing.

Decisions made in real time to ensure a fiction free customer experience.

Ultimately, preventing application fraud is key to a successful digital fraud strategy.

Read more about the Intuition solution. Follow us on LinkedIn for more resources.