This post was originally published on Fin Extra
How do the challenges and rewards of implementing risk-based authentication compare? Is the risk worth it? What should be included in data-driven strategies for optimising payment transaction experiences? How has PSD2 and 3DS laid the foundation for enhanced and standardised security for online credit and debit transactions? In what ways should issuers and processers be educated in how machine learning and AI can help embed trust in the transaction lifecycle?
According to Juniper Research, the total cost of ecommerce fraud is set to exceed $100 billion by 2029. Against this fraud landscape—and in a world in which consumers expect increasingly seamless digital experiences—issuers are tasked with the difficult work of helping to create trust in transactions.
So, how can the European financial sector reduce fraud, increase approval rates, strike a balance with friction, and provide a better customer experience, all at the same time? While this may seem like it will require an upheaval of systems and processes, it is achievable. Risk-based authentication (RBA) is one such way that this can be supported, by applying varying levels of strictness to authentication processes based on the probability that an interaction is fraudulent.
Financial services players can leverage
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