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Findings from the report, Combating False Declines Through Customer Engagement, show that a large contingent of connected consumers are unforgiving of the inconvenience of a false decline. More than 42 percent of respondents said that a false decline would motivate them to leave their banking institution altogether.
– Retail Customer Experience
“False declines have a material impact on an issuer’s business. While lost transaction revenue is painful, damage to the issuer’s relationship with their customer is of far greater concern,” said Michael Thelander, director of authentication products for iovation. “Banking and financial institutions need to balance security levels with user experiences. Consumers are open to a range of authentication methods as long as they are easy-to-use. Dynamic multifactor authentication does just this by balancing security and user experience by adding flexibility to authentication.”
– Payment Week
iovation, the leading provider of device-based consumer authentication and fraud prevention solutions, today released findings from its newest consumer preference report, "Combating False Declines Through Customer Engagement." The survey, conducted in partnership with global research and advisory firm Aite Group, polled nearly 1,100 consumers across four generations to better understand the impact of false declines on the customer experience. Findings from the report show a large contingent of connected consumers are unforgiving of the inconvenience of a false decline, with more than 42% of respondents reporting that a false decline would motivate them to leave their banking institution altogether.
False declines occur when a valid transaction by the authorized cardholder is erroneously declined. Last year in the U.S. market, approximately $264 billion in card transactions were lost due to false declines from suspicion of fraud in 2016 and is projected to grow to $331 billion by 2018.
Millennials Willing to Sever Relationships with Financial Institutions
The report, which surveyed millennials (35%), Gen Xers (26%), Baby Boomers (32%) and seniors (7%), found that consumers' willingness to leave their bank over a false decline was directly correlated to their age, with 59% of millennials, or "digital nomads", admitting to being very or somewhat likely to leave their financial institution due to a credit card false decline. In contrast, just 21% of seniors would be inclined to leave their issuer over a false decline, suggesting that millennials are far less forgiving of the aggravation than older generations. Gen Xers and Baby Boomers fell somewhere in the middle, with 39% and 32% willing to leave their banks due to a false decline event, respectively.
Another deciding factor in whether consumers stayed with their banks was income level. Forty-four percent of consumers with income over $100,000 per year and 48% of consumers with income between $75,000 and $99,999 per year say they are very likely or somewhat likely to leave their financial institution due to a mistakenly declined credit card transaction.
"False declines have a material impact on an issuer's business. While lost transaction revenue is painful, damage to the issuer's relationship with their customer is of far greater concern," said Michael Thelander, director of authentication products for iovation. "Banking and financial institutions need to balance security levels with user experiences. Consumers are open to a range of authentication methods as long as they are easy-to-use. Dynamic multifactor authentication does just this by balancing security and user experience by adding flexibility to authentication."
All Demographics Open to Dynamic Multifactor Authentication
When it comes to transactional security, however, consumers have shown that the process does not always have to be completely transparent. Despite showing impatience with their issuer following a false decline, the majority of consumers across all age groups are open to an additional prompt for identity verification if there is suspicion of fraud, in the hopes of preventing a false decline from ever happening -- nearly 60% of consumers, in fact.
Sixty-five percent of seniors and boomers indicate that it's acceptable for their issuer to request proof of identity if there is suspicion of fraud, while 59% of Gen Xers and 54% of millennials agree.
"As the survey indicates, online banking customers growing openness to engagement represents new opportunities for banks as they look to reduce false declines" said Julie Conroy, research director for Aite Group's Retail Banking & Payments practice and author of the report. "The path to change will happen over time. But, the ubiquity of mobile devices is already driving progress by enabling a variety of new ways to harvest contextual and authenticating data, which informs institutions' authorization decisions and, ultimately, improves all user experiences."
To access iovation's full "Combating False Declines Through Customer Engagement" report, please visit: https://www.iovation.com/resources/reports/combating-false-declines-through-customer-engagement. This report follows a companion March 2017 report, "Moving Beyond the Password: Consumers' Views on Authentication" which examined the same group of banking consumers and their attitudes toward various authentication mechanisms used online today.https://www.iovation.com/fraud-prevention
Last week iovation announced that Dwayne Melancon was leaving Tripwire after 17 years and joining the company as the new Vice President of Product, so we decided to get in touch and see what are his future plans.“My experience at Tripwire ran the gamut – I served in a range of roles, from CTO to product management to head of R&D – but my ultimate goal was to create products that offered both a streamlined user experience and market-leading security protection,” he told us.
– HelpNet Security
As applications like Uber and Venmo are eliminating the need to physically carry cash or a credit card, our smartphones are quickly becoming the go to replacement for our wallets. To meet consumers where they are (on their phones), financial institutions like Chase and Wells Fargo will widely introduce card-free ATM options later this year in the hopes of delivering a more convenient consumer banking experience. But as with any new technology, mobile ATM access raises a new set of security challenges.
– Payments Source
This new movement, known as Bring Your Own Authentication (BYOA), holds the same promise of reimagining the way we think of authentication, putting the consumer (and device) front and center in the interaction, and relegating passwords to the background or eliminating them completely. But there are challenges to overcome in order for mass adoption.
– Network World
Portland, Ore., April 19, 2017 – iovation, the leading provider of device-based consumer authentication and fraud prevention solutions, today announced it has appointed Dwayne Melancon to the role of vice president of product. Dwayne brings world-class product expertise following 17 years leading product development at Tripwire, where he brought a number of cutting edge cybersecurity solutions to market. In his new role, Dwayne will be responsible for all aspects of product innovation as iovation aggressively expands its portfolio of cloud-based security solutions to meet customer needs at the growing intersection of fraud and authentication.
This appointment comes on the heels of several key milestones for iovation, including the general availability of LaunchKey, an advanced multifactor authentication (MFA) solution that broadened the company’s capabilities in contextual authentication well as the launch of its SureScore service, a machine-learning algorithm that analyzes millions of patterns of device, transaction, and account attributes to detect the subtle patterns that indicate fraud.
“There is a convergence happening now within the fraud and infosecurity landscape as enterprise CISO’s adopt a more holistic approach to their security posture. With Dwayne leading our product strategy, we have a proven leader who can deliver on our vision of frictionless fraud prevention and authentication,” said Greg Pierson, CEO and co-founder for iovation. “For more than two decades, Dwayne has been at the forefront of cybersecurity, embracing the customer experience to create dozens of market-leading security products. We are extremely fortunate to have someone of Dwayne’s caliber bring his unique talents to bear at iovation.”
Dwayne held many executive management positions during his 17-year tenure at Tripwire, including chief technology officer, product management VP and head of research and development. Prior to Tripwire, Dwayne spent six years at Symantec in a variety of management roles, including director of corporate internet services. As a cybersecurity expert and published author, Dwayne has been featured regularly on the BBC, Forbes and The Guardian and also coaches Fortune 500 CISOs and CIOs on how to effectively communicate cybersecurity risks to the board room and the C-Suite.
“Ultimately, fraud occurs when authentication fails. Yet so many organizations continue to treat the domains of fraud and infosecurity as disconnected silos,” said Dwayne Melancon, iovation’s vice president of product. “iovation is one of the few technology companies I’ve seen that really understands the value of connecting these two functions and can deliver it in a truly integrated and on-demand fashion. I’m looking forward to helping CISOs navigate this convergence.”
Passwords have been keeping sensitive computer data safe since 1961, when computer scientist Fernando Corbató first introduced the industry standard in online authentication to what was then a very small digital community. Almost six decades later, and too many consumer data hacks to count, now 87-year-old Corbató can attest that password usage has become a bit of a “nightmare.”
– ITSP Magazine
But a recent survey by Aite Group and ivation suggests this strategy may not work across other areas of banking — the survey looks at authentication methods and customers’ willingness to try new ones — or at least, it won’t work for everyone. “Customers can be bought,” according to the survey, but it must be the right offer at the right time to the right customer. 51% of participants in the survey of about 1,000 bank customers would be willing to try new authentication methods with no incentives at all. 25% would not be swayed by any incentive the bank was willing to offer. 15% were swayed by an offer of $10, and a further 9% held out for $25.
– Bank Innovation
An Aite Group survey of almost 1,095 U.S. consumers, sponsored by iovation, found that over 40 percent of respondents said they feel extremely or very frustrated when they can't get into their banking website due to a forgotten password, and almost one in three feel equally frustrated when they can't log into an e-commerce or media site.
– eSecurity Planet
Pundits have predicted the demise of the password for years, yet the simple user-name-and-password combination lives on, frustrating security pros and helping to fuel a spiraling epidemic of data breaches. The reason for the password’s longevity lies in its familiarity compared to newer, more effective authentication methods, says a report released this week that looks at how the payments industry could finally get consumers to adopt at least some of these alternative technologies.
– Digital Transactions
Despite being comfortable using passwords, an iovation survey has found that 85 % of banking customers are willing to replace passwords with modern authentication methods. However, due to varying comfort levels and willingness to learn new techniques, different generations expressed varying preferences around the best alternative to replace the ubiquitous password
– The Paypers
PORTLAND, Ore., March 21, 2017 – iovation, the provider of device intelligence-based customer authentication and fraud prevention solutions, today released new insights from its latest consumer preference report, “Moving Beyond the Password: Consumers’ Views on Authentication." The survey, conducted in partnership with global research and advisory firm Aite Group, polled nearly 1,100 consumers across four generations who use online and/or mobile banking platforms to better understand their attitudes toward various authentication mechanisms used today. Despite being comfortable using passwords, the study found that an overwhelming majority (85%) of survey respondents recognized the need to bolster online security by moving beyond this increasingly archaic method for authentication. However, due to varying comfort levels and willingness to learn new techniques, different generations expressed varying preferences around the best alternative to replace the ubiquitous password.
Passwords have served as the defacto industry standard for online user identification for more than two decades, but highly skilled criminals and ever-frequent data breaches prove time and again, they are simply not secure. Despite being high-risk, usernames and passwords are still very much engrained in the fabric of online banking and commerce as the primary means of initial authentication.
“There’s no denying that passwords can no longer protect online assets the way they are meant to, the way they used to,” said Julie Conroy, Research Director for Aite Group’s Retail Banking & Payments practice and author of the report. “This impasse is prompting consumer brands to finally consider how they can realistically deliver on the vision of a future without passwords. Luckily, the increasing pervasiveness of mobile devices provides new opportunities to offer superior authentication capabilities and password alternatives that another can improve security and the overall consumer experience.”
A clear correlation emerged between consumers’ openness to change and their age as iovation surveyed millennials (35%), Gen X’ers (26%), Baby Boomers (32%) and seniors (7%). The report revealed 95 percent of millennials are open to using something other than a password, as are the majority of Gen X and Baby Boomer respondents (both 82%). And while only 16 percent of seniors are very willing to learn new authentication methods, 48 percent report that they are willing to try a different way. Each generation expressed a unique preference for a replacement to the easily hacked or forgotten password authentication method:
Millennials – As the most receptive audience to a new authentication experience, millennials perceived fingerprint biometrics (85%), eye biometrics (76%), and knowledge-based authentication questions (74%) to be the most effective identification methods.
Generation X – Following in the younger generation’s footsteps, 37 to 52 year olds cited fingerprint biometrics (75%), eye biometrics (70%), and knowledge-based authentication questions (66%) as their top choices for password replacement.
Baby Boomers – The majority of Boomers believed fingerprint biometrics (76%), eye biometrics (67%) and facial recognition (59%) to be the leading authentication practices in lieu of the typical username/password combo.
Seniors – A surprising 68% of respondents over the age of 71 were in favor of the fingerprint biometric, while 53% of seniors thought the facial recognition tool was an effective security measure.
“What this survey makes clear is that online banking customers across generations remain extremely frustrated with passwords and if provided with more modern authentication alternatives like biometrics or facial recognition, they will eagerly embrace them,” said Michael Thelander, Director of Product Management for iovation. “Consequently, a growing number of financial institutions are realizing that dynamic authentication technologies like iovation’s LaunchKey represent both a more secure, user-friendly experience to their customers.”
iovation recently announced LaunchKey, an easy-to-use mobile SaaS multifactor authentication solution in recognition of this consumer demand. LaunchKey stores and processes sensitive data locally on mobile devices so that consumer brands and end users don’t need to worry about passwords leaking – it simply doesn’t require one. Consumer brands can instead choose which risk appropriate multifactor authentication options to extend to their customers. Individual users can then choose the authentication approach that best fits their security needs in a frictionless yet streamlined user experience.
To access iovation’s complete “Moving Beyond the Password: Consumers’ Views on Authentication” report, please visit here. An infographic called How Do Bank Consumers Really Feel About Authentication can be found on our blog.
User authentication is one of the basic components of any cyber security program. But in some cases, traditional authentication processes are not enough to provide strong security throughout a user work session. That’s where continuous authentication comes in. Check out this informative article in which iovation is noted as one of a handful of vendors capable of providing this advanced functionality.
– CSO Magazine
The accelerating popularity of price comparison websites (PCWs) in the UK insurance market – also called aggregators – is putting more control and choice in the hands of consumers. However, this is also opening up a new realm of possibilities for fraudsters. Read more on page 53 of Modern Claims Magazine.
– Modern Claims Magazine