With social engineering scams dominating fraud tactics today, forward-thinking banks and credit unions are turning to the science of behavioral biometrics to help their customers thwart even the most sordid criminals.
In today’s digitally dominated world, cybercrime happens so frequently that experts believe there is a new victim every 22 seconds. And that ratio is only expected to increase. It’s an unrelenting, nondiscriminatory force that impacts billions of people every year in the U.S. alone, costing even more in losses—in both dollar amount and reputation—for financial institutions.
That’s why it’s no secret that fraud prevention is one of the biggest challenges facing financial institutions today. Criminals have become more sophisticated and brazen, stealing seemingly anyone’s personal information with surprising ease. From mass data breaches to grandparent scams, their constantly evolving tactics make it hard for traditional fraud mitigation solutions to keep up.
While the big institutions have the resources to dedicate hundreds to their fight against crime, thwarting even the most relentless of criminals, smaller banks and credit unions are left exposed, lacking the capacity and capability to keep their customer’s accounts secure. But it’s not for lack of trying; it’s because the game has changed. Cybercrime today is much more of a con than an impersonal breach in security measures, and criminals have become disgustingly astute at getting victims to hand over their information—willingly.
So how do banks and credit unions mitigate fraud when it’s more about protecting customers from themselves than it is about shoring up their security protocols? Believe it or not, they’re turning to science and partnering with industry pioneers leveraging newer, more efficient methods of tracking down cybercriminals, using one of the most promising tactics available today—behavioral biometric intelligence.
The art of the steal.
Gone are the days of buying lists of personal data on the dark web and using that information to take over an account. Today’s fraudsters are experts in a far more brazen, much more personal tactic, one that’s taking root and spreading fast: social engineering scams.
As one of the most common types of fraud today, it’s often a simple phishing email that asks you to click on a link or download an attachment that installs malware onto your computer. In many cases, scammers impersonate people you’d typically trust, like a representative from your bank’s customer service department, suggesting that you need help.
And unfortunately, the engineering component of social engineering is by no means technical in nature, which is why they’re so pervasive. Scammers simply trick a person into giving them information that they shouldn’t. A social engineer doesn’t need to crack your password. Instead, they use emotional manipulation to convince you to give it to them over the phone by claiming there’s something wrong with your account and that they’re here to help.
It’s not hard to see why social engineering scams are particularly problematic for typical fraud detection—it’s nearly impossible for current systems to distinguish between a good user and a cybercriminal when cybercriminals know the answers to security questions. Think about it this way: if we, as people, can’t tell if a caller, texter, emailer, or user is actually from a legitimate source, and our current detection technology has the same problem, we can’t exactly program those systems to just “be better.”
Or can we…?
The science of your actions.
Thankfully, in the world of fraud mitigation and prevention, the good guys are out there, using the science of individual digital behaviors and the power of innovative technology to combat this new wave of cybercrime.
Behavioral biometric intelligence is a type of advanced automated authentication that uses unique digital and physical patterns in an individual’s behavior to verify their identity. In fraud mitigation, it can detect and prevent fraudulent activities by analyzing user behavior patterns, such as keystroke dynamics, mouse movements, device handling, and other user interactions with the system.
By analyzing a user’s digital behaviors, it is possible to create a unique profile for that individual that can be used to verify their identity when accessing sensitive information or performing transactions. Any anomalies in the user’s behavior—whether a change in typing cadence or using the opposite hand when swiping your device—can trigger an alert, indicating potentially fraudulent activity.
Behavioral biometrics leverages machine learning to analyze patterns in human activity and understand user intent. One thing that makes this science so powerful is its ability to learn from past experiences—mitigating the need to be programmed with every possible scenario. It will continue learning as long as you feed it new data, which means it has the potential to get smarter over time.
So why is this important for your bank or credit union?
The case for behavioral biometrics for your FI.
Behavioral biometrics offers easier, faster, and more secure experiences for banks, credit unions, and their customers. This is why more credit unions are turning to it and other machine-learning solutions for fraud prevention. Here are just a few ways that banks and credit unions can benefit from a robust fraud solution that leverages the science of behaviors:
Better user experience: If your bank or credit union still relies on outdated knowledge-based authentication (KBA) methods for security, your customers are feeling the pain. Lengthy authentication processes that require members to recall multiple pieces of information slow down the interaction and cause frustration. It can feel like an interrogation, let’s be honest. Behavioral biometrics can help financial institutions create a seamless and convenient user experience. Members are not required to remember passwords, and the system can recognize them based on their behavioral patterns, making login and authentication processes smoother.
Faster, real-time security: Manual fraud prevention still happens—mostly after the fact. If your bank or credit union is looking to stop fraud in its tracks, as it’s happening, then you need a fraud solution with machine learning capabilities. Solutions powered by behavioral biometrics process vast amounts of data much faster than humans ever could. They also provide predictive capabilities that give your institution the power to stop fraudulent transactions before they even happen, or at least in real-time.
The same level of fraud prevention as large institutions: It’s no secret that large global banks fill building floors with people fighting fraud on behalf of their customers, while banks and credit unions may only have a handful. But small banks and credit unions have the same proportion of fraud as large global banks, without the resources to manage it. With behavioral biometrics and its inherent machine learning, smaller financial institutions can promise the same consumer fraud protections as the large global banks, with much lower costs.
The holy grail of cybersecurity for your FI.
Fraud is like a game of whack-a-mole…just when you think you’ve got it handled, something else pops up. Fortunately, game-changing companies are taking the world of cybercrime by storm and partnering with banks and credit unions like yours.
At Lumin Digital, we help financial institutions build and deploy next-gen digital experiences that help to serve, engage, and grow their membership base continually. As a part of that solution, we are proud to partner with Biocatch, an industry pioneer in behavioral biometrics, to help our customers prevent and mitigate even the most advanced fraud tactics.
BioCatch delivers advanced fraud protection through innovative device fingerprinting, network analysis, and behavioral insights that provide banks and credit unions with actionable intelligence to create a secure and frictionless digital customer experience. We leverage the power of device and behavioral data to create a world of trust and ease across the digital identity lifecycle from account origination to monitoring online sessions and beyond. Contact Biocatch today to help your bank or credit union stop fraud in its tracks.