A massive move online requires more creative ID solutions

Register now

Many companies are creating innovative solutions to help keep people safe online, while also making it easier for them to transact and move freely.

Rather than keeping different passwords and security questions handy, people should be able to be trusted to be who they say they are online, just like they are offline. This only happens when privacy-compliant data works together to offer the same level of trust and efficiency as a driver’s licence or passport would offline.

Self-sovereign identity is one innovation, based on blockchain technology, that could dramatically improve fraud detection and customer experience. It would allow people to manage their own digital identity in a safe way, and share it with companies they transact with as needed.

Similarly, data consortiums that safely combine insights to create a bigger, more accurate picture of customer behavior can help create more confidence and reduce the need for cumbersome hurdles like logins and the like.

What COVID-19 has shown is that digital behavior is still evolving dramatically. Many industries saw three to five years of forecast growth in only a few months. Industries like telemedicine and online grocery shopping will need to move quickly to secure their own businesses as they deal with new adoption just as many long-standing online businesses will need to make some updates. Creating a fraud detection strategy that takes advantage of new innovation is the key to success.

Companies shouldn’t rely too heavily on trend data for forecasting. Probabilistic modeling is most accurate in a stable environment, where past data is likely to predict future behavior.

As trends as recent as March are no longer relevant, companies need to forecast using new types of data. People may be unemployed, they may have moved, they may order all of their food online, and have taken up new hobbies. With old probabilistic models, all of these factors would be flagged.

Intent-based data solves this problem with more real-time information such as recent search data. Intent data doesn’t care about past averages or norms; rather it is directly reflecting real behavior that would either support or contradict current behavior being evaluated. If someone spends time searching car rental options for a drive to Miami, that context can help predict additional related purchases that may otherwise seem anomalous. Or, it could flag a purchase in a specific location that doesn’t match with their intended destination.

Identities associated with private VPNs have often been flagged. With so many people online, they are sharing computers with their family. They may increase their use of different browsers or a private VPN. Or, worried about fraud, may use a VPN to obscure their location.

With many seniors banking and shopping online for the first time, simple rules like login page timeouts, CAPTCHAs and complicated passwords are major hurdles to winning new customers. It’s better to find authentication options that rely on other data that can work in the background, and allow for simpler processes.

For reprint and licensing requests for this article, click here.
Authentication E-Commerce Digital payments Merchant