Technologists and the fraud prevention industry can learn a lot from ancient philosophers when it comes to passive authentication. One of my favorite philosophical teachers is the Daoist deity Lao Tzu, who once said that the best leader’s work is complete when the people say, “we did it ourselves.”
Within fraud prevention, the best anti-fraud technologies are those that improve results when people go about doing their regular activities. Phrased differently, the best solutions require only the passive participation of consumers, eliminating friction from the customer experience and allowing merchants to maximize their sales.
Passive biometric authentication
The most obvious example of this is within the area of biometric data, where the best solutions are entirely passive. For example, the way a customer swipes their smartphone screen is unique to them and can be used to authenticate their identity without any special effort or awareness on their part. Several fraud solution providers, including Sift Science, Riskified and SecuredTouch already offer solutions to merchants and financial institutions based on passive biometric authentication. Among those with machine learning solutions this passive biometric authentication is more commonly called behavioral data.
Passive Identity Authentication
When it comes to identity information, the passive approach is the best as well. Many bank customers are familiar with knowledge-based authentication (KBA) where the bank asks you for the name of your pet, your first school or your mother’s maiden name. Such identity challenges are both annoying and ineffective. A customer doesn’t want to have to remember how exactly they entered the name of their first school to access their bank account or make a purchase. Meanwhile, an enterprising fraudster can find your pet dog’s name just by checking out your social media profiles. They can also look up your mother’s maiden name online just by using Google. Your first school can often be found by looking at websites for school alumni information. Active identity or knowledge-based authentication isn’t worth the hassle it causes. What is far better is passive identity information authentication like that offered by Pipl.
The Pipl advantage
Pipl takes the information your customer provides when opening an account or filling a transaction order and verifies it against the information already on file and connects it to other relevant identity information. You can use a client’s email address to find out what college they went to and where they recently worked. A phone number can lead you to past addresses and the person’s age. All publicly available identity data tied to a person’s profile is available in less than a second using Pipl’s Pipl data API or as fast as your manual fraud analyst can type.
Since Pipl’s identity database is based on social media profiles and other publicly available identity data created and transferred by your customers online, it requires no effort on their part. They will think their data is secure because of the work they did themselves and you will reap the benefits in terms of customer satisfaction and conversions.
At the end of the day, everybody likes to be lazy. That means don’t force your customers to play a more active role in your payment security and fraud prevention than they want. A true leader in fraud prevention should employ solutions that are barely felt…so much that your customer thinks they did everything themselves without your prompting.
Go here to learn more about using Pipl for fraud prevention.
Original blog post written by former Pipl Technology Evangelist Ronen Shnidman. Ronen is now Managing Editor @ about-fraud.com