2020 Roundtables: What the Experts Said

Identiq is all about collaboration - our product literally works by bringing companies together so that they can pool knowledge and trust in good users. 

In the second half of the year, we started hearing from the companies we work with that they were really missing the chance to talk to their peers about changes in the fraud trends, tactics and prevention techniques. So we took our love of collaboration a bit further, and arranged a series of roundtable discussions so that fraud fighting pros could discuss topics on their minds. 

Loads of issues and ideas were raised in these animated and engaging discussions, but there were 3 big takeaway messages.

1 - 2020 Changed How Fraud Fighters View Manual Review and Automation

A number of participants said that before this year, they’d seen manual review and automation as separate and, sometimes, pushing in opposing directions. 

Manual review takes time and is more painstaking, and involves deep domain expertise to be successful. Automation, whether through rules or machine learning, is designed for scale and speed, but takes a more broad brushstroke approach. 

That’s no longer how they see things. During the pandemic, teams learned to rely on manual review when rules or machine learning couldn’t keep up with the changes in customer behavior. Manual review of transactions or activities adapted faster to shifting norms, and kept the lights on as the company handled the transition.

Automation came back into play as manual reviews provided the research which new rules or guidance was based on, so that the automated part of the system could be refitted quickly for the new situation. Automation then played these new insights out at scale, fast, so that the team could see the impact on their KPIs. 

Far from being for separate use cases, or even part of two different (and sometimes mutually exclusive) kinds of fraud fighting, this year showed manual review and automation as two mutually supportive parts of a whole. Manual reviews stepped in where automation faltered, only to have the favor repaid later when automation picked up manual research insights and demonstrated their validity. 

Many participants reported a refreshed respect for both manual review and automation, and a clearer understanding of how to use them both separately and together to make the most of each. Some who had been interested in moving in an increasingly automated direction now felt that this should only happen if supported by a strong manual research component, while others who had been suspicious of automation as too inaccurate had new appreciation for its benefits of scale, when used appropriately.

2 - Inclusion is Now a KYC Concern

One fascinating aspect of the KYC roundtable was that, perhaps in reaction to social justice movements prominent in the news over this year, inclusion is now a hot topic in many companies, particularly when it comes to KYC.

The KYC process is to an extent somewhat exclusive, typically demanding kinds of documentation or proofs that not everyone has. This can be valuable for the purposes of identity verification, but it may also leave disadvantaged consumers out in the cold. Similarly biometrics, particularly facial recognition, may favor certain ethnic groups over others.

A number of different solutions for the inclusion problem were put forward, including looking for different forms of verification, testing specific parts of the process by geography and analyzing the results, tailoring the process as much as possible to each customer, and even working with regulators to make the process more sensitive to differences in the experiences and documentation of different groups.

One suggestion which really lit up the discussion was to use customer guidance - examine the points at which certain customers find hurdles, and analyze the steps they choose to take if they can’t get over one of them. Those steps can be made into an alternative process, which can itself be streamlined as much as possible.

3 - Sometimes Delay is OK - Even with Digital Goods 

A surprising part of the gift card roundtable debate was the participants’ willingness to consider elements of delay in gift card purchase. We think of delay as inimical to success when it comes to digital goods, but many participants felt that, in the right circumstances, delay can be a fraud fighter’s friend.

Delay was partly valuable to reduce the attractiveness of the product to fraudsters (a significant gain) and partly in order to give time for research, in terms of searching for patterns across an account, the account ecosystem as a whole, or (for those who accept many types of gift card) the specific cards being used. This research was considered so valuable that it was worth sometimes delaying a transaction in order to facilitate it. 

The reason for this seemed to be that gift cards, by nature, have anonymity built in to the product. To offset that, extra research, especially into patterns, can be invaluable - even if it means adding in a delay before the purchase is approved, or instituting a policy of a short delay before the card can be used after purchase. 

It was agreed that customer education is also an element to consider here. If sites are considering changing policies about how quickly a purchase will be completed, or how soon a gift card may be used, that’s a discussion which must not only involve multiple levels of the organization, but also engagement with the end-user. 

Many participants felt that the more consumers understand that policies are being undertaken to protect them and their accounts, the more receptive they are to accepting minor inconveniences or changes in the way things are done. It can even be a net positive experience, leaving users feeling that the company cares for and is trying to take care of them.

See you in 2021!

We can’t wait for next year’s discussions!

Sign up now to make sure you don’t miss the chance to take part in the 2021 roundtable series - email hello@identiq.com or contact us via our website.

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