Findings from a recent global study uncovers disturbing trend among Asia Pacific businesses focusing on revenue generation over security and fraud risk.
Experian recently released its 5th Global Identity and Fraud Report. Respondents from Asia Pacific include those from Australia, India, Japan and Singapore.
Some disturbing trends in Asia Pacific were uncovered in the report, and businesses in the region ought to take note.
We asked Ben Elliott, CEO of Experian Asia Pacific to share further insights based on the report:
What are the current APAC consumer and business behaviors and priorities as they navigate the pandemic, based on the report?
Elliott: The COVID-19 pandemic has caused a surge in digital demand. According to our recent Experian’s 5th Global Identity and Fraud Report, which included respondents from Australia, India, Japan and Singapore, nearly half (46%) of consumers surveyed anticipate increasing their online spending in the next three to six months. To meet these digital demands, businesses are increasingly going online – in fact, 80% of businesses have a digital online identity strategy in place for recognizing customers across digital platforms.
However, with these interactions shifting online, the risk of fraud increases significantly, as fraudsters ramp up attacks through faceless, automated schemes. And despite this growing fraud risk, Experian’s report shows that the businesses surveyed across APAC are deprioritizing security and fraud prevention – with a 16-percentage-point decline in business intention to increase fraud management budgets, from June 2020 to January 2021.
For APAC consumers covered in the report, a safe and secure online environment is a top priority for 56%, and three in five expect businesses to provide increased levels of security and data protection when going online. As you can see, there is somewhat of a disconnect here, and we believe all businesses should be taking the increasing fraud risks seriously, because their customers certainly are.
Why is it important to prioritize security and fraud prevention as part of the digital experience strategy for APAC businesses in the long-term?
Elliott: For businesses to meet and exceed customer expectations, they need to maintain their focus on security and fraud prevention even while prioritizing their customers’ digital experience.
Companies should not view fraud prevention and customer experience as separate efforts, because we cannot have one without the other. In fact, efforts in building a top-notch digital experience are ineffective if the company is unable to accurately recognize customers as part of a fraud prevention program – or worse, if they are errantly enabling fraudsters by believing they are legitimate customers. While financial losses are the primary damage, businesses must not underestimate the collateral damage which includes customer trust – something hard to regain once lost.
As such, striking a balance between ensuring exceptional digital experience and having a strong fraud prevention program will be crucial for businesses.
Why is technology – and properly managed data – key to the recovery of APAC businesses and economies in a post-COVID-19 world?
Elliott: We believe data is incredibly powerful and properly managed data can be used as a significant force for good.
By tapping on advanced technology such as artificial intelligence (AI) to draw real-time insights, businesses can be one step ahead with a comprehensive understanding of the rapidly changing landscape, with the ability to predict upcoming trends or shifts in demands. Leveraging data in a responsible manner is critical to help business leaders make informed decisions, navigate the crisis, or set a course for the future.
The right technology and data ensure businesses not only survive but thrive beyond the pandemic.
How does Experian play a key role in using innovative technology to modernize industries, prevent fraud and provide real-time data to support APAC consumers and businesses?
Elliott: We believe that effective fraud prevention does more than stopping fraud reactively. With more than 300 fraud specialists around the world, we continually invest in innovative technologies to help businesses build a layered and hassle-free approach to fraud. This means being able to seamlessly stop real fraudsters without creating friction in the digital experience of the legitimate customers. As a result, businesses can safeguard their real customers without compromising their digital experience.
Additionally, we are committed to being early adopters of any technology that might improve the power of data for our clients and consumers. For instance, our Experian Fraud Analytics Suite allows us to fully automate our fraud detection services, enabling our products to counter fraud in a more efficient and cost-effective way.
With this solution, one of our clients, a large-sized bank, saw an 80% reduction in false positives and cut their costs by approximately US$9 million. Our analytics’ self-learning capabilities mean that our clients can combat rapidly changing fraud patterns with much lower costs right from the day they begin working with us.