How Businesses Balance Convenience and Digital Security

digital identity

First, the good news: digital commerce is living up to its promise. Consider these numbers:

    • 52% of all e-commerce traffic globally is from a mobile device[1]
    • While 31% of orders are placed on mobile devices, 40% of traffic from buyers is on a mobile device[2]
    • 53% of smartphone users are actively using mobile banking[3]

So, what’s the bad news? Fraudsters are quickly adapting their tactics to this channel. Online transaction fraud is expected to hit more than $25 billion by 2020.[4] Online banking is expected to account for 27% of fraud by value, while online retailers are expected to account for 65% of fraud by value.[5]  These numbers represent a huge risk to businesses.

The Imbalance that Can Trip You Up

Now that digital is ingrained in consumer behavior, it is imperative to provide safe and secure transactions. But, it is not always easy to do both. For example, consumers often must type in personal information and complicated passwords to complete a transaction or establish an online account. All too often, frustrated shoppers abandon their cart—and don’t finalize the transaction.

On the other hand, consumers consider security to be a priority. More than half say they only use credible websites (57%) when making payments.[6] So how can businesses balance convenience with security?

Five Ways Digital Identity Brings Equilibrium to Online Accounts

A universal digital identity can establish trust between parties who are not interacting face-to-face. As much as consumers need to know their identity is protected, businesses need assurance that online customers are who they say they are.

Digital identity is an authentication method that uses the consumer’s smartphone to connect multiple factors—such as biometrics, personal data, and transaction history—to a unique identity. As a result, consumers gain the benefit of password-free security. Organizations improve the customer experience, while reducing costs associated with password resets or abandoned shopping carts.

A universal digital identity has numerous benefits for both consumers and businesses:

  1. Improves customer service. Password resets can cost you customer loyalty. But compromised security and fraud can be even more detrimental to customer relationships. A digital identify can give consumers convenience and peace-of-mind.
  1. Protects against fraud. A digital identity puts consumers in charge of authentication. Unique biometric identifiers, such as a fingerprint, are extremely difficult to replicate and help eliminate cases of stolen identity.
  1. Reduces risk. Digital identity methods help reduce fraudulent transactions, so businesses lower their exposure to risk and costly payouts.
  1. Taps into the network effect. As the network continues to grow, it becomes better equipped to detect fraud. Predictive analytics, based on consumer geolocation and transaction data, can provide alerts when any activity seems amiss.
  1. Saves time and money. Managing the logistics on the “back-end” of accounts is time-consuming and expensive for financial institutions and retailers. A password-free digital identity reduces customer service calls related to account problems and frees up resources for more important activities.

OnlyID™ solution, backed by Equifax and FIS, combines leadership in banking and payments, consumer identity verification and data analytics to lay the foundation for a safer, more powerful digital identity network. The predictive analytics, built from data repositories housing over 800 million consumers and banking records, create unmatched authentication and fraud detection capabilities.

Want to Learn More?

2018 American Business Awards for OnlyID include
GOLD STEVIE® WINNER for Best Marketing or Sales Brochure or Kit – Online/Electronic
GOLD STEVIE® WINNER for New Product or Service of the Year – Software – FinTech Solution

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[1] Shopper First Retailing: What Consumers are Telling Us About the Future of Retail. Salesforce, Sapient Razorfish, 2017. https://www.demandware.com/uploads/resources/REP_Sapient_Report_EN_27JUNE2017_FINAL_.pdf

[2] Shopper First Retailing: What Consumers are Telling Us About the Future of Retail. Salesforce, Sapient Razorfish, 2017. https://www.demandware.com/uploads/resources/REP_Sapient_Report_EN_27JUNE2017_FINAL_.pdf

[3] Consumers and Mobile Financial Services, 2016. Federal Reserve System. https://www.federalreserve.gov/econresdata/consumers-and-mobile-financial-services-report-201603.pdf

[4] Managing the Risk of Fraud, Juniper Research, May 2016. (Whitepaper, www.juniperresearch.com)

[5] Managing the Risk of Fraud, Juniper Research, May 2016. (Whitepaper, www.juniperresearch.com)

[6] Whom do consumers really trust? PWc Global Consumer Insights Survey 2018.