JOHANNESBURG – “We have connected all of our lives – personal, professional and national – to the Internet. That’s where the bad guys will go because that’s where our lives are, our money, our secrets.”
Those were the prophetic words of then-FBI director James Comey, back in 2013, in a presentation on cyber-security to the Senate Homeland Security Committee.
Six years later, his prediction has proved to be spot on, and it’s created one of the great dilemmas of the modern age. Consumers increasingly want to be online – but so do the bad guys. Consumers want to feel safe against the growing tsunami of fraud threats – but they don’t want their user experience to suffer in the process. In a nutshell: consumers have greater access to digital channels than ever before, but fraud has increased and evolved.
Let’s look at the scope of the problem for a moment. Across the world, more consumers than ever have access to the Internet. In South Africa, that’s an estimated 51%, and growing daily. 95% of that internet access is via a mobile phone, according to the Pew Research Centre. At the same time, TransUnion is seeing fraud evolving and increasing globally. Between 2015 and 2018, through our iovation reputation reports database, we identified a 433% rise in the so-called ‘synthetic identity’, where criminals combine real and fake information to create new identities. A 126% rise in consumer account takeovers. A 146% increase in true consumer identity theft.
Why is this a problem? For one, ensuring a secure, seamless customer experience is fundamental for businesses to effectively grow and thrive in a digital world. But fraud has both a business and a customer cost, and any fraud prevention efforts must be balanced with the impact on the customer experience.