There is no fraud-reduction business case for voice biometrics
Posted on August 16, 2010 by Nik Stanbridge
This is the simple statement made by the head of innovation in a major global financial institution. What he means is that the fraud that they have is manageable, isn’t increasing and is perpetrated by a small number of known individuals whom they are quite capable of monitoring irrespective of how sophisticated their methods become. To put the level of fraud we’re talking about here into perspective, this company claims to be the 2nd most-hacked institution after Google and PayPal (who tie in 1st place). The business case is actually about customer satisfaction. All of their product and service innovations are driven by this. And nothing else. What can voice biometrics do for this company? Well, it can increase customer satisfaction and retention by reducing the ID&V burden, pure and simple – and it can do this in a whole range of clever and secure ways.
This message was then echoed by another senior figure in a global financial institution (whose brand is a household name).
This is quite a staggering insight – that the cost of fraud to banks and financial institutions is seen by them as “the cost of doing business”. This of course isn’t what they say in public. The sensational headlines in the press about hackers, fraud and accounts being compromised aren’t actually a thorn in their sides. What is though, is customers deserting them for better customer service and products at a rival bank.
This is not to say that fraud isn’t one of the drivers for the use and adoption of voice biometrics, but this is coming from customers themselves. They are demanding a more secure environment within which to conduct their financial business. The banks are using it as a stalking horse – telling customers that they’re implementing the technology in order to protect them, the customer, from fraud, when in reality they are using it to improve customer service. Everybody wins right? Customers feel warm and protected. The banks get to keep their customers who in turn now feel able to buy more products from the institution that’s protecting them.
