News Article

Prevent fraud, gain customers. Here’s how.

Fraud costs financial services big money – and that’s not including the reputational damage. According to UK Finance “research found that the cost of dealing with fraud, particularly low-value cases, is very high... Fraud under £1,000 can cost £19,793 to deal with, on average.” Discover the tech and expertise you need to help combat the criminals for your customers and company. 

According to Action Fraud, payment fraud is: “... any fraud that involves falsely creating or diverting payments. 

Payment fraud can include: 

  • creating bogus customer records and bank accounts so that false payments can be generated 
  • intercepting and altering payee details and amounts on cheques and Payable Orders, then attempting to cash them 
  • creating false payment and financial information to support fraudulent claims for benefits 
  • processing false claims by accomplices for benefits, grants or repayments 
  • self-authorising payments to oneself.” 

The cost to your customers 

Fraud is hitting the pockets of consumers too. The BBC explain:In total, £754m was stolen through fraud in the first half of 2021, an increase of 30% compared with the same period last year. Within this total, so-called authorised push payment (APP) fraud - when victims think they are paying a genuine organisation - rose by 71% to £355m.” 

“More than two thirds of adults (36 million) have been targeted by a scammer since January, new research by Citizens Advice has found.” 

How it impacts consumer’s and their buying decisions 

With facts like these consumers are increasingly aware of security when they make payments. The Experian Global Insights Report reveals digital online spending will continue “to gain strength even as consumers emerge from lockdown and return to in-person transactions.”  

<Note: I will put this in an infographic which we can use for second push>  

  • 52% are concerned about their online transaction security. 
  • 42% are more concerned about their online security in the past 12 months 
  • 73% of consumers “put the onus on companies to protect them online.” 

So with increasing demand from consumers, now is the time to bolster security - to ensure regulatory compliance and moreover to deliver reassurance to customers and help increase attraction and retention.  

Plus, the same report states 90% of customers “want complete or some control of how their data is used, with 57% being willing to share data if it ensures greater security or prevents fraud.” This increase in date sharing helps to create a stronger picture of customers which is valuable in itself – another reason to shore up security in your financial platform.  

But our industry isn’t resting on its laurels, “Our Fraud - the Facts 2021 report, sponsored by LexisNexis Risk Solutions, highlights that... the banking industry worked hard throughout the pandemic to protect customers from fraud and to go after the criminals behind it, with over £1.6 billion of fraud stopped in 2020.” 

PSD2 and you 
PSD2 is an acronym for Second Payment Services Directive. This is a set of EU regulations aimed at improving security for credit and debit card users. The legislation came out of the European Banking Authority and was adopted into UK law.  

There are several parts to PSD2. One part is the requirement for financial institutions to implement Strong Customer Authentication (SCA) by the deadline.  

SCA is a set of additional checks when someone uses a payment card to verify the identity of the person who is using the card. In some instances, the cardholder will be required to verify their identity in two different ways. The deadline for SCA to be implemented in the UK was 14 March 2022.  Our 3DS feature offers a range of different authentication methods for you to pick from - Biometric, One Time Password (OTP) or In-App Out of Band (OOB) to meet SCA requirements under PSD2. You can read more about 3DS below.  

Delivering security for your customers 

Partnering with a payments issuer like GPS means you can access security features quickly and efficiently, without having to draw on existing employee resource, recruit new employees, or add to or create a new tech stack, and other actions that could impact the bottom line.  

GPS provide the security product to make issuers and programme managers compliant with the Strong Consumer Authentication (SCA), schemes regulation, and mandate - all without the hassle and expense of doing this in-house. 

Partnering with a trusted and proven processor who knows the field inside out, means you get the tech and specialist expertise you need along with the features your customers deserve – and are searching for from their financial provider. It means you can concentrate on what you know and do best, innovate and grow your business.  

Here are just some of the features GPS provides – and the benefits you can deliver for your customers.  

GPS MultiFX 

The GPS MultiFX feature lets your customers hold different balances simultaneously in one wallet. The solution supports Visa and Mastercard and integrates with leading FX rate providers to provide shorter time to market. 

Benefits for you: 

  • New revenue opportunity - Flexible choices for you to add fees. 
  • Seamless integration - Managed through a single API integration. 
  • Attract and retain - An enhanced value proposition to draw customers in. 

Benefits for your customers: 

  • Ease and convenience - Spending on one card and wallet. 
  • Enhanced control - Control over balances and spending. 
  • Tailored proposition - Build the right product for your target customer. 

 GPS Protect 

GPS Protect is a software designed to protect you and your customers from fraudulent activity. The system works in near real-time by checking transactional data and calculating risks based on the rules you set for the system. These performance monitoring capabilities significantly reduce the financial risk that your business and customers are exposed to. 

Benefits for you: 

  • Early detection - Reports and alert history will identify what actions you could take in advance of transactions being processed. 
  • Enhanced controls - Set the anti-fraud rules and easily monitor, prioritise and assign owners to action alerts. 
  • Expert support - GPS Program Managers support and guide which rules will best mitigate against fraud. 

Benefits for your customers: 

  • Trust and assurance - Knowledge that their account is being constantly monitored for any suspicious activity. 
  • Reduced risk - Suspicious transactions flagged so you can prevent your customers being the victim of fraud. 
  • Effortless protection - Proactively managing incidents of fraud on behalf of your customers. 

3DS 

GPS 3D Secure is a customer authentication solution that helps prevent fraud in online credit and debit card transactions. 3DS offers a range of different authentication methods for you to pick from - Biometric, One Time Password (OTP) or In-App Out of Band (OOB) to meet SCA requirements under PSD2. GPS also offers Knowledge Based Authentication. The security feature is developed in conjunction with Cardinal Commerce and is supported by Visa and Mastercard. 

Benefits for you: 

  • Reduced risk of fraud - Reduced fraud to retain customers and reduce admin costs. 
  • Regulatory compliance - Ensure you are meeting SCA requirements. 
  • Customisable experience - Determine your program. 
  • Real-time security - Real-time Data Exchange API calls. 

Benefits for your customers: 

  • Choice and control - Customers can choose their authentication method for example biometrics or One Time Passwords. 
  • Reduced payment errors - Accurate authentication so payments go through with less false declines. 
  • Trust and assurance - Peace of mind that payments are secure and personal data is safe. 
  • Enhanced experience - Tailor the authentication process to suit your customers’ preferences. 

GPS is right at the heart of the ecosystem delivering our customers unrivalled access to global expertise, up to date regulatory knowledge and cutting-edge proprietary technology. We’re a tried and trusted fintech enabler with proven experience supporting start-ups to double unicorns, we know how to help business expand their propositions – because we've successful done it, globally, with a huge range of financial platforms.   

Discover more here: Security and fraud mitigation | Global Processing Services - GPS