Asian banks urged to step up fraud protection

A recent conference on fraud management has put focus on the need to adopt a system-wide business analytics approach to protect bank consumers against fraud. The need is particularly pressing at a time when there are various channels that can be easily exploited, the conference organiser noted.

The fraud management conference sponsored by FICO, a technology provider of business analytics solutions, brought together nearly 30 banking executives from the Asia Pacific region. Among the top of executives in combatting fraud include minimising overall customer impact and operational risk, as well as reducing fast-growing threat of application fraud.

To address some of these concerns, the executives were advised to adopt an enterprise-wide approach to combatting fraud, using new analytics-based system.

Compared to a monolithic approach to protecting customers from fraud, FICO said the enterprise-wide approach can protect customers on each banking channel without disrupting the customer experiences.

"This new approach emphasises strengthening the weakest links in a bank's entire fraud protection system while building towards enterprise protection in a structured, incremental manner," said FICO in a statement.

FICO warned that emerging banking channels, such as mobile banking, has necessitated faster fraud detection. FICOS estimates that in the Asia Pacific region, the incidence of fraud will increase by 10 to 20 percent in 2013.

Customer experience

"Consumer confidence has become a key differentiator for banks, and the customer's experience when confronted with fraud is especially critical," said Dan McConaghy, president, FICO, Asia Pacific. "By taking an enterprise-wide approach, banks can earn their customers' trust with swift detection and customer contact, while also minimising losses."

FICO cited the 2012 CEB TowerGroup report "Adoption and Investment in Financial Services Technologies: Enterprise Fraud Management," which noted that 32 percent of banks have said they intend to adopt or replace their enterprise fraud management systems by 2016.

One of the banks keen in addressing customers' needs for more security in banks' products is BDO Unibank, one of the Philippines' largest banks. A bank official said their customers are particular about security for their bank products.

Said Susan Rivera, first vice president for BDO Unibank: "Fraud risk and customer service is a very important balancing act for our bank. To ensure that our customers are protected while enjoying our product features, we will be one step ahead of them in addressing their needs and working hard to manage the emerging threats and challenges swiftly and painlessly."

The conference was an opportunity for FICO to announce to the regional banking industry its plan to launch new solutions and forge partnerships to help banks combat fraud.

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