Mobile Opens the Door for Better Fraud Detection

Mobile banking services will become increasingly important to consumers, as more and more adopt smartphones and use them to stay in touch with their personal financial pictures.  My colleague Paul Swyny recently blogged about the growing opportunity to leverage mobile communications in banking.  In particular, we're finding the mobile channel can be extremely useful for fast, early fraud detection. 

For many years now, I’ve been speaking with financial institutions about the hidden fraud-fighting power that lies within something as simple as a customer-initiated account alert.  The perfect scenario involves customers logging into your secure banking website and setting up a series of account alerts that empower them to monitor their financial accounts in near or real time.  

A classic example of this is the customer who wishes to be emailed every day with his/her available checking account balance.  A simple option like this not only meets the customer’s need for convenience, it also helps deter account fraud.  That customer will likely be the first person to notify you if the account balance tips precipitously low for no explainable reason.  Remember: Your customers can be powerful allies in your fight against fraud. 

To do this, however, there needs to be a jumping-off point.  If you are not already offering SMS text communication and account alerts, you should look into adopting technology that allows you to start taking advantage of the mobile channel’s incredible potential for better customer communication and fraud detection. 

Your best bet is to consider a two-way SMS messaging option (which we discuss further in a recent webinar with our partner Telrock).  This allows the accountholder to receive and reply to messages sent by your institution’s fraud monitoring department when suspicious transactions occur. You’ll get faster responses than if you require customers to pick up the phone—not to mention, save call center time and costs.