Managing fraud through chat is better for businesses and users

As digitalization has transformed businesses the ever-present threat of fraud has grown exponentially. However, banks and their users are increasingly realizing that using chat platforms to manage and mitigate fraud offers them immediate and significant gains.

According to security company, Kaspersky, the number of unique malicious objects detected in 2019 rose by 13.7%. The growth of online skimming files detected, meanwhile, grew by a whopping 187%. Online skimming (or sniffers), are scripts embedded, mostly on ecommerce sites, used to steal credit card data.

Part of the process of managing potentially fraudulent payment transactions usually involve asking card holders to engage with call centers when potential fraudulent transactions are detected.

We are all used to getting calls or messages from our banks to check if we have authorized payments that have been flagged as possible fraud. But dealing with call centers is not only inefficient, but costly for the bank and frustrating for the customer. Making use of chat to resolve fraud queries is a better option all round.

If a user gets a message in chat asking about a fraudulent transaction, they could reply in chat asking for more information or they could confirm that they had made the purchase – in their own time. This asynchronous communication makes a big difference to businesses like banks and airlines who are dealing with high levels of declined or disputed payments.

Imagine if you were traveling when you received a message to contact a company to verify a transaction. Calling a call center in the US when you are in Singapore is often a great inconvenience and comes at a substantial cost. Hardly an efficient way to deal with the challenge.

The inbuilt security of using a platform like WhatsApp, WeChat, and even Apple Business Chat helps engender user confidence. The green badge next to the number shows that the business contacting you has been verified and means communications can continue with confidence. It is much harder for malicious players to impersonate your bank or airline in a chat conversation.

Chat also helps companies understand customer behavior better, especially when applying sophisticated machine learning or AI. In this way, companies can authenticate customers better, because they know them better.

Identity theft is more difficult when using mobile chat commerce. When someone is using a chat application their identity is known with a very high level of certainty. In addition, it is possible to get a high biometric authentication by analyzing a user’s style of chat. This can be through the length of messages, how quickly their responses are made, as well as typical words that are used. It is also possible to have additional security questions captured through a chat engagement. All of this means that the fraud department can flag suspicious behavior with a high level of confidence.

The pressures placed on a call center to manage fraud are further raised during peak shopping periods. Kaspersky announced in January this year that during the 2019 / 2020 festive season phishing leapt by almost 10% compared to the previous quarter.

There is an uncomfortable tension for call center agents. They are tasked by their employer to rigorously scan for fraudulent transactions. But at the same time they must protect the customer relationship. During high volume periods the chances of humans making an error are far higher than a chat bot which is relying on high levels of good user data. There is no doubt that authenticating a payment transaction in mobile chat is easier. It is non-intrusive and its efficacy is far higher than other channels. This is good for businesses and for users.