Optimizing Trust in a Digital World

Optimized trust enables organizations to find, reach, and approve ideal customers in familiar and unexpected places. In this recap of our November 11 Market Pulse, Shelly Nischbach, Vice President and Sales Leader at Equifax Workforce Solutions, and Rich Stuppy, Vice President and CCEO at Kount, discuss optimizing trust in our digital world. The topics they covered include fraud, the customer journey, and their recent sessions at Money 20/20.  Below you will find answers from Nischbach and Stuppy to questions asked by our moderator Alan Pate, Fintech Marketing Leader at Equifax. 

What are the fraud and verification concerns you’re hearing from customers? Why is fraud a different kind of business? 

Shelly Nischbach: Fraud continues to be top of mind and the number one focus for many of our lenders. It is referenced in many places in our client meetings and at the recent Money 20/20 conference. It is challenging how many forms it can take. There are extremely sophisticated fraudsters. Rich Stuppy and our Kount team are great at identifying these situations. 

From a recent statistic, one in five borrowers admit to misrepresenting their income.1 Conversely, we get about that same statistic from lenders, that their pay stub from them is fabricated. That being said, knowing who you are dealing with on the other end is critical in making sure your decisions are accurate with current data to combat that fraud issue.1

Rich Stuppy: Part of the challenge is developing the understanding that fraud can be individual actors and organized crimes that act like a business. These organized crime connections can be multinational. You need to understand what kind of attack you are undergoing. The reason fraud is a different business is because it only falls under two rules: don't get caught and get the money. When you compare that to what legitimate businesses have to deal with with thousands of rules, that asymmetry makes the fight a tough fight. You have to bring in an understanding of digital. It is an everyday battle. An approach to solve those challenges is through data. 

How do trust and customer experience play into the customer journey? 

Rich Stuppy: As the world winds down this winding road that we call digital transformation, businesses of all shapes and sizes are enjoying many more opportunities in these challenges. What people are figuring out, including Kount, is that in the digital world, even though it is relatively anonymous, it is a data rich environment.

In the digital world you can leverage the right data at the right time to have and build a much more comprehensive understanding of your customer. This allows you to craft an amazing, well branded customer experience for your customer to help maximize the two key levers. These two key levers are maximizing revenue opportunities and maximizing customer lifetime value. Once you have that knowledge and treat the customers the way they are supposed to be treated by stopping the fraudsters and creating a custom strategy for your customers, they will come to trust you and you can trust them. Building that trust is a two way street and that customer will reciprocate with their wallet. 

Shelly Nischbach: Lenders have to develop that process in the safest and quickest way. Lenders need more loans and they need to do it with less risk. Being able to find that quality borrower and delivering their needs before they move to someone else is critical. The trust in this equation shows that you have a mutually beneficial relationship. Speed is incredibly important in the digital environment. 

How are organizations leveraging data to develop a deeper understanding of their fraud and credit approval challenges?

Shelly Nischbach: We studied with lenders that it is important to have the benefit of a digitized, automated process that provides low friction and a great customer experience. When instantly verified by The Work Number, applicants are up to 40% more likely to get funded.1 Lenders using this data gain improved conversion rates. The credit approval challenge is diminished when you prove you know your customer. 

Rich Stuppy: From a fraud and risk standpoint the tagline is, understand the journey and understand the customers. We see people bypassing conversion killing and protection and adding value where it makes sense for their customer. This should include signals from both the digital and physical world, because the customer experiences now and businesses dealing with big tech, are realizing their physical footprint is valuable. Combining it with the digital journey, they are going to get a better view of the customer allowing them to model where it makes sense.

How have business changes impacted customers’ approaches to credit approval processes? What are the implications for financial inclusion?

Shelly Nischbach: First, credit is evolving and consumers are more than just a credit score. With that being said, lenders need a more financial picture across all populations. At Money 20/20 we talked about a number of these groups. There are tens of millions of consumers that have thin credit files or no credit file. Score adverse adults do not have a visible credit score and will seek out lenders that use alternative forms of information in their decision process. Pair that with financial inclusion being a key area of focus for the OCC and look at their published objectives.

They talk about needing to promote financial inclusion, fair treatment to all the customers you serve. Our efforts to support expanding access to credit by studying the probability of securing a loan before versus after their employer joining The Work Number. Better visibility using better data in this frictionless process has great implications for solving financial inclusion. 

Click here to watch the November Market Pulse webinar for more on optimizing trust in a digital-first world.  Access additional related insights here and register for upcoming webinars here. To read more about trust in the digital world, read our Q&A blog.

 

1 Verifier Value Messaging Deck by Equifax

 

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