We’re in an omnichannel world where retailers are embracing speed and convenience just as much as product selection, customer service and price.

Today’s technologies have not only given customers the ability to have a more personalized online experiences, but have also allowed us to rethink how we approach shopping, ordering with our voice through services like Google Home or Amazon Alexa, instantly comparing prices across platforms, and even leaving cash and traditional payment methods behind in favor of digital payment options.

For retailers and payment providers, the gold standard of customer experience is a frictionless transaction, and for years now the industry has leveraged technology and resources to minimize friction wherever possible. However, it's time to change our mindset. It’s not about taking the friction out of online payments, it's about putting it in the right spot.

The conflict between how the consumer wants to shop and the existing friction involved in the e-commerce experience has led the payments industry on a mission to remove as many of these speed bumps as possible.

Yet, this new, increasingly smooth payments journey has created an increase in fraud that can cause even more headaches for consumers, retailers and financial institutions. For example, cutting five seconds from the average transaction may reduce cart abandonment and assure the transaction is completed, but if their account information is compromised, consumers must now coordinate with their bank to correct and fix the account, wait for a new card to be issued and manage a whole new authentication process.

Embracing a more intelligent approach to the payment journey and putting the right kind of friction in the right places could allow consumers to shop securely with ease, while retailers could increase sales and reduce fraud and banks could mitigate costs associated with fraud prevention and recovery.

Spotting anomalies throughout the identification process is the key to applying the right level of friction at the right place and right time. While an anomaly in location can be a key indicator of potential fraud, it can also be as benign as a last-minute road trip and a swipe at some retailer miles outside the consumer’s normal location, creating an unwanted speed bump if the transaction is declined and a hold is placed on the account. But adding behavior as a means of identification by recording and processing a multitude of different data points, from the way a user swipes their phone to their individual keystrokes, can be a better indicator.

Advances in artificial intelligence and machine learning are allowing us to do a better job of determining the identity of consumers, while introducing the right level of friction to fight fraud. By using several streamlined data points and markers such as device, location and behavioral profiling, as well as client and customer preferences, we can effectively strengthen the identification process.

But what about when friction is needed? Businesses, from retailers to banks, can better fight fraud and increase customer satisfaction by strengthening the identification journey via strategic, additional layers of granularity, in a seamless way.

Whether as a standard, or in reaction to a potential security threat such as flawed mobile operating system upgrades, these decisions need to be made in real time. By intelligently applying friction, where the entry of a PIN or a swipe of the screen can be used to correlate against known data, we can better prove that the correct user made the transaction and avoid the costs and disruption associated with fraud and disputed claims.

In an increasingly online, faceless and interactionally rich environment, how do we assert identity? Asking customers to create accounts, enter passwords or answer static questions is a surefire way to increase customer frustration. But as criminals are turning to technology to more easily deceive consumers and steal payment information or account details, businesses need to constantly stay one step ahead.

Current systems usually involve adding another layer of security into the traditional process for authentication, such as a PIN sent to a mobile phone. But these systems are often seen as cumbersome, with numerous recent examples demonstrating hackable flaws. As a result, biometric authentication has become an industry standard, using a fingerprint or facial recognition, but these systems can have limitations and flaws as well.

Although we’re not quite ready to say goodbye to passwords completely, we are well on our way to a world where we can more intelligently and securely identify each individual. This will, in turn, help businesses across all industries better assist their customers, dramatically reducing friction in the buyer’s journey, offering consumers a seamless shopping experience and helping to drive sales.