Despite consumers’ complacency, 94% still expect proactivity from the online companies or services they use when there is a risk of fraud
New research by digital identity pioneer, Callsign, has found that the majority of efforts organizations make to educate customers about potential fraud risks are not working. While most respondents said they read fraud warning messages (86%); of those who did claim they had seen warnings, 58% said they had not done anything different as a result.
13% stated that they do not look at them at all and just closed the window. Of those who read them, 28% said they are unable to recall what they say. Further, 17% of consumers remember what the messages say but haven’t subsequently changed their online behaviour.
While many people simply ignore fraud warnings, the study also found that 94% of consumers still expect proactivity from online companies or services they use when there is a risk of fraud. In addition, consumers want to be warned about fraud when they are online: this includes when shopping (66%), online banking (64%) or using an online service (60%).
However, only 18% of those surveyed strongly agree when asked if the companies and services they use online do a good job protecting them against fraud. So, whilst consumers expressed a desire for organizations to keep them safe, trust to do so is low.
It is therefore unsurprising that 76% of respondents said they would like the choice to opt in or out of being sent fraud warning messages if they had the choice.
“At first glance, our research suggests consumers want to make their own decisions around the risks they take, choosing to opt in or out of receiving fraud alerts, even ignoring them when they are delivered. However, there is a disconnect between the safety these warnings are supposed to bring and the poor user experience they cause – hence they are perceived as a nuisance,” explained Amir Nooriala, chief commercial officer, Callsign.
Callsign solutions make digital lives easier and secure by using deep learning techniques to combine event, threat, and behavioural analytics with multi-factor authentication. By providing real time risk intelligence, Callsign enables banks and online retailers to intelligently adjust authentication journeys and improve the customer experience while simultaneously catching fraudulent activity. A white paper explaining this can be downloaded from here.
Of the 94% of respondents who expected online companies and services to be proactive when they are at risk of fraud; 41% wanted organizations to send a warning message and ask additional security questions before they could do anything else, to check that they fully understood the situation.
However, respondents are very specific when it comes to the different scenarios in which they would like to receive those warnings, such as if a website is insecure (52%), making an online payment or money transfer (42%), setting up a new account (38%) and logging onto an app or online (38%).
“A blanket messaging approach is not an effective way to educate and elicit the right behaviour or response from consumers. Banks and online services must consider the psychology around how and when individuals consume fraud messages. Timeliness is key, you must get the alert in front of people at the exact moment they are at risk of fraud. Without this, banks will continue to spend huge amounts of money on fraud prevention messaging that will never have an impact,” added Richard Shotton, co-author of the Callsign ‘Wild, wild web – Preventing online scams’ report and author of The Choice Factory.
“The research demonstrates that when organizations attempt to protect their customers through education during the user journey, if it’s not delivered in a timely manner, people circumvent it to achieve the most frictionless experience. This presents an opportunity for organizations who do this well to win the digital trust of their customers. Passive behavioural authentication solutions and well-timed, effective messaging must go hand in hand to create the most trusted, secure and frictionless customer journey possible,” said Namrata Jolly, General Manager Asia Pacific, Callsign.
