3 Potential Fraud Risks Banks Should Focus In Digital Era
The digital era brings an unavoidable challenge to the financial institution in a global scale. Banks used to face check and wired frauds, now the fraudsters do it with the help of the internet. Banks are required to provide practical services for customers in the digital age, but at the same time, they have to race with the fraudsters. Here are three potential fraud risks that banks should focus on.
1. Cybersecurity
We often hear news of cyber-attacks against financial institutions, including banks. But, we need to keep alert for the emergence of new fraud methods because the fraudsters are getting organized. Possible losses does not occur directly in financial form but in the form of customer data. Stolen customer data can be exploited for other frauds.
2. Account opening
Account opening is still a slow and impractical process for customers because most banks still require face-to-face. There are several banks that have enabled their customers to open accounts online. However, online account opening cannot be fully done for security reasons. Banks still have to apply the identification and verification process (ID & V) to new customers for compliance and minimize fraud risk, for example by collecting fingerprint data. This ID & V process still requires customers to meet face to face with customer service bank. Banks still need to focus on addressing potential fraud online account opening so customers can enjoy low-risk practical services.
3. Internet of Things (IoT)
Banks can use IOT technology to create more engaging and contextual customer service or to generate smarter and more customer cross-selling opportunities. However, IoT raises the potential risk of frauds. In theoretical any device connected to the internet can be hacked so that at risk, in this case, is the privacy and personal data of the customer. Professionals still need to further monitor the potential forms of fraud carried by IoT and implement the latest security systems.
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