Data security provider iovation Inc. has released two-factor phone authentication software it says will provide extra protection for consumers making online purchases.
When a consumer initiates a transaction online, iovation's Phone Verification sends a one-time verification passcode to the customer's landline or mobile phone, the Portland, Ore.-based company says.
The code can be sent as a text message or through an automated voice call, localized in native languages and dialects, iovation says.
The customer must then enter the code into a specific website before being allowed to proceed with the transaction.
Iovation will use its phone verification service in conjunction with its cloud-based ReputationManager 360 device authentication service to detect malware and account-takeover threats, the company states.
"With today's always-evolving cybercrime schemes, it is essential to provide a layered defense against the most sophisticated attacks," Scott Olson, iovation's vice president of product, states in a press release.
Delivering one-time passwords to a phone is a familiar process to consumers, one that can help them feel more secure, CEB TowerGroup research director Jason Malo states in the release.
"Using an 'out-of-band' communication channel significantly reduces transaction risk because it requires a compromise to both the channel the transaction is initiated from and the alternate channel to complete a fraudulent transaction," Malo says.
Because Phone Verification helps companies ensure their customers are who they say they are at the time of the transaction, the service will also reduce chargebacks on fraudulent transactions, iovation says.
Last summer, iovation released a report documenting the increase in fraudsters exploiting consumers' mobile devices.