New FICO Report: Fraud Protection is Top Priority for Canadians When They Choose a Financial Provider

A new survey from FICO focused on consumer perception of how financial organizations manage fraud found that 69% of Canadian consumers rank good fraud protection as one of their top three requirements when opening a new financial account

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Fraud Protection & Compliance

TORONTO – December 14, 2022 –

Highlights:

  • The Consumer Fraud Survey measured 1,000 Canadians on their fraud preferences when choosing to open an account with a financial organization.
  • 74% of Canadian consumers understand that identity checks are for their personal protection.
  • Biometrics are popular amongst Canadians – 63% prefer fingerprint security and 53% prefer face recognition.

Global analytics software platform provider, FICO, released the Consumer Fraud Survey 2022 research report, which explores the shift in consumer expectations on how financial institutions manage fraud. The report surveyed more than 14,000 global consumers across 14 different countries worldwide, including Canada. Overall, the survey found that consumers expect a strong fraud stance from financial institutions as part of the customer experience; successful fraud protection can attract new customers and enhance customer satisfaction.

The research provides insight into how consumers select specific financial providers. It found that 69% of Canadian consumers choose good fraud prevention measures as one of their top three priority requirements when selecting a financial account provider. Fraud protection was more important to them than other factors including value for money (63%) and good customer service (37%). Despite valuing fraud protection, Canadians are not keen if fraud prevention methods become too difficult or time-consuming.  19% of Canadian consumers claim that they have already abandoned opening an account because of the provider’s identity checks.

“Global consumer awareness of fraud is on the rise, and it is imperative that financial organizations deploy preventive measures that support consumer preferences and needs, while keeping the organization safe,” said Kevin Deveau, vice president and general manager of North America at FICO. “Our research shows that financial account providers are chosen when they are perceived to have good fraud protection, but the relationship can be at risk if fraud protection has a negative impact on customer experience. Organizations need to be mindful of consumer expectations and make available multiple fraud protection options that fit their needs.”

Consumers want to feel protected but don’t want disruption

Consumers must engage with fraud protection and security when they open a new account or when they use an existing account. Increased fraud risk has led to an industry drive to provide frequent security and fraud checks. Over the last year, one-third of Canadian consumers shared that they have seen an increase in identity checks when making an online purchase and when logging into their bank accounts. While this can make them feel safer, they could also find it off-putting. In addition, 17% of Canadian consumers responded that they have reduced use or stopped use of a credit card because of identity checks.

74% of Canadian consumers acknowledge that identity checks are for their protection. In addition, 68% of those consumers recognize that identity checks help keep their financial services providers safe and 40% recognize that security checks are necessary to prevent money laundering as well.

In an increasingly digital world, one-third of Canadian consumers reported they are likely to open a financial account digitally and three quarters even expect the opening of a checking account to take less than half an hour. If verification takes too long, they will abandon the online application.

Consumers are still reliant on old security methods but are developing a preferred taste for biometric authentication

Despite well-publicized issues such as data breaches, Canadians are still keen on old-fashioned account protection methods such as the use of usernames and passwords; 30% of consumers say they have a strong preference to use them and 45% say they like them. Canadian consumers consider usernames and passwords secure with 74% rating them as providing good or excellent security. Biometrics are a newly popular security choice for Canadians – 30% expressed a strong preference for using a fingerprint scan while an additional 33% say they like them.  27% have a strong preference for using facial recognition while another 26% like it.

28% of Canadian consumers think that it is at least possible that their stolen identity has been used by a criminal to open a financial account and 5% are definite that they have been the victim of such an identity theft. Financial institutions need to deploy preventative fraud protection measures to help keep their consumers and organization safe.

For more details and insights regarding the survey results:

For more information on FICO fraud solutions, visit www.fico.com/identity.

About FICO

FICO (NYSE: FICO) powers decisions that help people and businesses around the world prosper. Founded in 1956, the company is a pioneer in the use of predictive analytics and data science to improve operational decisions. FICO holds more than 200 US and foreign patents on technologies that increase profitability, customer satisfaction and growth for businesses in financial services, telecommunications, health care, retail, transportation and supply chain, and many other industries. Using FICO solutions, businesses in more than 120 countries do everything from protecting 2.6 billion payment cards from fraud, to helping people get credit, to ensuring that millions of airplanes and rental cars are in the right place at the right time.

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