Fraud is an ever-present threat. It is especially harmful at a time
when credit unions are needing to shore up liquidity and fight for
every new dollar and new member. Creating a safe, secure, and positive
member experience while mitigating potential fraud loss is top-of-mind
for most credit unions. However, some are hesitant to implement new
processes and solutions. They fear they might damage their members’
banking experience -- especially at account opening when new member
first impressions matter most.
Account opening can be an unexpected place to battle fraud.
But, it is an important point in the journey given the prevalence of:
Below are three ways in which credit unions can combat fraud
at account opening.
1. Look out for signs of synthetic fraud
36% of people with good credit are being manipulated via
synthetic ID fraud.* This occurs when fraudulent member profiles are
created based on several different members' real data. How
can credit unions ensure members are who they say they are?
Leverage comprehensive data
insights. Better analyze potential synthetic ID
behaviors and patterns with multidimensional data sources.
This allows you to identify fraudulent requests and segment
fraudster behavior from legitimate member behaviors while
protecting the member experience.
Better analyze PII mismatches using data assets
that can build holistic identity profiles to signal PII anomalies
between primary owners and authorized users to help cut false
positives and protect from losses associated with synthetic ID
Sort applications that
trigger a synthetic ID alert. It is important to
have a manual process in place once an identity has
triggered a synthetic ID alert. This provides an extra layer
of security and protection for the credit union and can help
mitigate potential loss in the future.
Implementing these best practices have shown real results.
For example, one company improved its fraud catch rate by 7x*. Other
benefits can include less application fraud and reduced first payment
defaults on personal lines of credit.
2. Establish identity trust with new members
Another way to prevent fraud from digital channels is to
verify the identity of both online and in-person members at
account opening. Carefully orchestrated verification strategies
are critical in today’s digital era. These strategies fight
existing and evolving fraud without disrupting the members' experience.
verification for key member data such as
phone, email, address, SSN, DOB, and devices — either
standalone or as part of a layered risk mitigation strategy
which allows a credit union to react quickly to
potential fraud and confirm a new member’s data. Real
time verification can help prevent fraud and also
remove friction to enhance the member experience.
Pair risk mitigation with other identity
solutions to confirm identity legitimacy by
cross-checking multiple data points which can increase the
ability to approve more identities and enable greater
3. Provide less friction for members
When it comes to entering personal information, members can
be deterred by having to manually enter too much application data.
This could lead to transaction abandonment and loss of revenue. To
prevent this, credit unions need a way to identify and authenticate
the unknown member while reducing application friction.
solutions to help simplify the generally
tedious process of data entry on a mobile device and
other digital channels to enhance the member experience. As
an added bonus, this can help identify and
authenticate members at the point of account opening --
specifically during the application process.
Automation is key when it comes to
verifying a new member’s identity. The more seamless the
application process, the better the member experience.
Automated processes can help identify fraudulent applicants,
minimize manual tasks, and help ensure the authentic identity of
Bridging the gap between risk mitigation and member
experience is challenging, but with a member-friendly account
opening process that also integrates these robust,
behind-the-scenes fraud prevention methods, credit unions can
better verify the information of their members so they can
mitigate fraud, enable greater efficiency, and reduce costs.
Discover more ways to achieve a frictionless experience and
security with this presentation.