We’ve all seen the recent news stories and read the articles about fraudulent transactions and account openings occurring at financial institutions across the country. Consumers are beginning to wonder if they can really rely on their banks to keep their financial best interest in mind. Financial institutions are wondering if they’re next. Everyone is wondering what they can do to protect themselves.

Over the next few weeks, we’ll take a deeper dive into how financial institutions can transform the consumer experience by integrating various forms of authentication into their processes, workflows, offerings and solutions. From ensuring an audit trail for account openings to ensuring consumers have the ability to validate high dollar transactions. Authentication provides for use cases throughout the full financial institution life cycle.

In this first post, we’ll touch on how banks and credit unions can integrate authentication solutions into their organization to safeguard themselves and their consumers from fraudulent bank opening situations and to ensure proper identity upon new account requests.

Today, a variety of security solutions are in place to help protect a financial institution from outside attacks and the use cases for authentication are many and varied – which is good news. But what’s more interesting to note, especially in light of recent activity, is that there are authentication solutions which would have alerted consumers to the activity which was taking place within their account. This week, let’s specifically look at two different account opening scenarios.

First, Consumer A is at home having dinner with their family when they receive a push notification on their mobile device that asks them to confirm their new account with Bank Z. Knowing that they are not in the process of opening an account, Consumer A quickly declines the new account opening through the push notification and calls their bank to investigate the situation. When financial institutions offer this type of authentication service through their mobile app, they are not only offering their consumers protection against fraudulent account openings, but also protecting themselves from insider activities which, when discovered, can reflect poorly on the bank or credit union.

Next, Bank Y has iBeacon technology integrated into their mobile application which allows them to better identify consumers within the branch through Bluetooth technology. Consumer B initiates a new account at home through the bank’s website. When she walks into the bank, her phone connects via Bluetooth to the bank’s solution and alerts bank employees to her identity and why she is at the bank. While she is waiting in line to carry out her transaction at the bank, she will receive a notification that will verify her identity and her wishes to open a new account. This technology also allows for the bank personnel to review her account information ahead of her arrival at the teller window and be prepared with cross selling opportunities.

This iBeacon technology has also proven highly effective when ensuring identity in payment card instant issuance situations. For example, if a fraudster gains access to a consumers laptop and access to their banking portal and requests a replacement payment card online. When the fake consumer goes in to the bank to receive a new payment card, the financial institution can ensure identity by sending a push notification to the account holders phone – in this case, the bank would then know that the card request was not authentic and could deny the instant issuance of the payment card.

These use-cases are just the start to the ways in which authentication solutions can help protect financial institutions and the consumer. Next week, we’ll dive into a variety of consumer authentication use cases – from approval of high-value transactions to mitigating card not present fraud.

Entrust Datacard