Post on 26-Jun-2015
description
8 Actions to tackle Online fraud9 SEPTEMBER 2014,ELIE CASAMITJANA / PRODUCT MANAGER FRAUD
agenda
New opportunities, new threats
8 Actions to tackle online fraud
Q&A
1New opportunities, new threats
4
Online fraud trends in Europe
+21,2 %
· CNP fraud increased by 21,2 %
Year-on-Year*
· 60 % of European fraud are CNP
fraud.
· France & UK are top 2 countries
· More and more « sophisticated »
fraud patterns
· More and more « burst out » attacks
*source: ECB report February 2014
5
Understanding the true cost of fraud
direct financial lost+
lost revenues+
prevention costs
TOTAL COST OF FRAUD
8 Actions to tackle online fraud2
7
1 Data is key,use it effectively
Identify all data you get from your customers
Check for any additional data
Share all this data with your fraud prevention tool(s)
Help differentiate genuine transactions from suspicious /risky ones>
8
What type of data can be used for fraud detection ?
*all this data can be gathered by your Payment Service Provider in certain cases (ex: hosted page)
Other data
inputs
Personaldata
Service §or
specificdata
Paymentdata
- Card data - Cardholder name - CVV - Transaction date & time - …
- Product type - Date of departure - Departure/ Destination location - Delivery method - …
- Contact data - Billing data - Shipping data - …
- Device Fingerprinting - IP address - Proxy piercing - NPA - …
9
2 Automate your decisions
Identify the percentage of order reviews you currently perform as opposed to automated decisions
Identify ways of differentiating between good and bad orders, looking for automated tools that enable you to do so without resort to manual review
Define and monitor automated decision thresholds. Bear in mind that the lower the average basket amount, the less profitable is the manual review
Optimise manual review rate and reduce prevention costs>
10
3 Monitor denied Transaction rates
Introduce a monthly report that identifies KPIs related to the percentage of denied transactions
Clarify thresholds at which a more in depth analysis is required
Identify root causes and define possible changes to be made
Implement proposed changes on a selected portion of your orders, monitor the results and validate the changes for all relevant orders
Boost sales and enhance customer satisfaction>
11
4Adopt an individual countryand specific payment methodapproach
Identify payment methods available in each country, consumer preferences, payment method risks and guarantees
Apply granular decision making by defining a payment method specific fraud detection configuration
Implement all your KPIs and monitoring tools, segmenting them according to the relevant payment method and country
Improve your fraud and revenues KPIs>
12
Payment method landscape in European countries
Define most relevant fraud prevention policy based on local specifics>
*source: Ingenico Payment Services transactions over the past 12 months
United Kingdom Italy Spain Belgium France Germany Netherlands0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Direct Debit
Open Invoice
Purchasing Card
WebBanking
Money wallet
Debit Card
Credit Card
13
5Using authentication tools dynamically
Introduce regular reports on basket abandonment rate for 3-D Secure and non-3-D Secure... Break the analysis down according to geography and basket size
Identify segments where using 3-D Secure harms conversion significantly
Implement a dynamic 3-D Secure strategy
Measure the impact on your sales and fraud KPIs and refine the configuration
Optimise your conversion and reduce your risk>
14
3-D Secure adoption & impact on conversion
Transactions with 3-D Secure protocols
Define a strategy based on your business specifics>
*source: Ingenico Payment Services transactions over the past 12 months
2013-Q1 2013-Q2 2013-Q3 2013-Q4 2014-Q1 2014-Q2 2014-Q30%
10%
20%
30%
40%
50%
60%
70%
80%
90%
United Kingdom
Italy
Spain
Belgium
France
Germany
Netherlands
15
3-D Secure adoption & impact on conversion
3-D Secure impact on conversion can depend on :
- Country- Amount- Channel (mobile, etc)- Issuer- Sub-brand- Industry/Products
Introducing a flexible approach to 3-D Secure based on:
• Above criteria• A combination of above criteria• The fraud risk score
Mitigate your risk and boost your conversion>
16
6Use negative and positive lists
Track your disputed transactions data – e-mail, telephone number, IP etc
Track VIP and loyal customers with any relevant unique identifier
Implement a process to add this data to negative and positive lists on a regular basis
Define rules so that the presence of this data in a list will positively or negatively affect the risk score
Prevent repeat fraud and improve customer satisfaction>
17
7Use the latest technologies
Identify the latest technologies to detect fraud with minimal impact on the customer experience
Calculate the cost of implementation to ensure a good return on investment
Once implemented track the results
Protect against sophisticatedattacks>
18
Fraud Expert / tougher on fraudster, simpler for you
Industry templates
Cross-merchantintelligence
Device fingerprinting
Flex3DS
Cross-parameter checks
Real-timebehaviouralmapping
IP Geolocation
19
8Ensure you get the right levels of expertise today,and tomorrow
Measure the annual overall cost of fraud to your company. Calculate the return on investment of employing full time experts or obtaining external support
Identify your in-house competences and weaknesses and, when relevant, find external support that will complement your team
Having defined your needs, search out the best consultancy and support packages that will support your business, today and into the future
20
Get the right expertise
A team of experts to support your business.*
• Example of key roles within a fraud team:
• Fraud Prevention strategist: Define fraud strategy & risk appetite of the company
• Fraud managers: Define & update rules
• Data miners/scientist/analysts: Monitor KPIs, KRIs, Manage smart data
• Fraud analysts/investigators: Review suspicious transactions and recommend action to be taken (deny/accept)
or ask your fraud prevention partner to support you with such needs.>
Q&A
More resources available on http://payment-services.ingenico.com/fraud