Authentication Strategies Every Credit Union Needs

A Two-step Authentication Approach

Consumers are always on the go, using digital devices to make purchases, check account balances and even apply for a loan. This trend will continue to grow.

U.S. mobile payments will reach $142 billion by 2019[1]; by 2020, 184 million consumers will make a payment or apply for a loan on their mobile device.[2]

As mobile transactions become the new norm, credit union members—like all financial institution customers—expect a seamless, secure experience. A mobile authentication strategy can help deliver this. In fact, not having a digital strategy can be costly:

• Up to 97% of mobile transactions are deserted[3]
• Switching and abandoning transactions costs an estimated $1.6 trillion in lost revenue annually— a significant figure that includes loan applications[4]

A practical authentication strategy balanced with a customer experience approach can address two important issues:

• Detecting potential fraud to lower the risk of loss due to fraudulent accounts or transactions
• Providing members with a safe, convenient and effective way to protect their accounts and streamline online business

“Know Your Member” Authentication

Today, new members and fraudsters alike prefer online channels. Credit unions need to expand online channels for marketing and new account acquisition without taking on excessive fraud risk. Authentication tools, like FraudIQ® Authenticate, allow credit unions to screen new members up front and ensure that new applications are not fraudulent. These solutions offer data access and analysis that help credit unions confirm identities.

Once a member account is set up, authentication solutions provide account protection for the member and the institution. For example, when the member signs into an account at a local credit union, the institution can confirm that the member’s identity data match. Then, the member completes the transaction seamlessly, while the institution works in the background to keep the account safe.

“Serve Your Member” Authentication

Credit union members want a convenient digital experience—one without complicated passwords and multi-factor verification. But they also want a safe and secure solution. By combining personal identity data, such as biometric data or unique passwords with transaction history, these authentication tools help reduce the risk of fraud exposure. Additionally, they deliver a seamless transaction experience to members.

Specifically, an authentication solution like InstaTouch® ID makes it easier for members to complete forms and applications online. Instead of having to key in personal data on a mobile device, the MFA solution uses member identification data associated with mobile carrier data to validate identity. Then, the required data is pre-populated into the application. As a result, credit unions can capture loan applications and other member needs that might otherwise be abandoned because the online process is cumbersome.

Contact us to learn more about authentication solutions and how every credit union can develop a sound strategy to help prevent fraud and deliver a positive member experience.

 

[1] US Mobile Phone and Tablet Commerce Forecast, 2015 to 2020. Forrester.

[2] “Mobile Wallets: News from the Front.” 2017. Aite.

[3] http://ventureburn.com/2016/01/7-reasons-why-customers-are-abandoning-your-mobile-shopping-cart/

[4] https://www.accenture.com/us-en/insight-digital-disconnect-customer-engagement