As part of my role, I get the opportunity to travel around the world. It’s great to see new cities and taste new foods. But at heart, I am a fraud fighter. So what I really love about traveling is observing fraud trends in each country.
It’s fascinating to see what trends are similar and different from country to country and sharing best practices.
Here’s a rundown of what I’ve seen in my recent travels. If you’re experiencing any trends I’ve missed, leave a comment and let me know!
Fraud in Mexico
Merchants in the Mexican market are in an interesting position right now, with great opportunity to expand their online presence. Historically, these merchants haven’t been keen on selling online. Now, customer expectations are more aligned with trends in other markets and the demand for eCommerce is beginning to rise. Merchants are looking to pick up and mirror trends they’ve observed in the US market.
However, protecting that online presence is proving to be a challenge. For one, access to external consumer data is not as easy as it is an other markets. In Mexico, there are few bureaus or third-party companies to provide that kind of information.
Furthermore, a lot of companies—especially those in the financial industry—have issues with internal fraud, where fraudsters will wait outside banks as employees leave. These fraudsters approach employees and offer money in order to share sensitive data. To prevent data leakage, employees cannot bring a cell phone or piece of paper into their work space.
Another observation about the Mexican market is that a high percentage of online transactions are declined. While there, I talked to a large ticketing company who has a high decline rate from failing their verification standards, pushing their customers to buy at a kiosk. In my view, this could lead to poor customer experience, as losing the opportunity to secure a ticket to an important event would be heartbreaking.
Brazil is the largest economy in South America. Based on the current fraud rates from the 2017 MRC Global Fraud Survey, after Mexico, Brazil ranks second for online fraud rates. Because the country was an early adopter of online sales, many opportunities for online fraud continue to persist. Credit cards are also widely used in Brazil, leading to an increase in stolen numbers and identities being used to commit fraud.
I noticed there is a lot of focus in that market to legitimize online account openings. Financial institutions are pushing for online applications and verifications, rather than requiring customers to visit a branch for their banking needs. However, the market is still struggling with setting the right friction balance necessary to make the online approval process succeed without becoming a burden to the customer.
And the United Kingdom
This is a market were we saw an earlier adoption of EMV via chip and pin along with 3-D Secure authentication, the second of which can impact conversion rates of online sales. As a personal example, when I go to UK and try to buy online, passing 3D authentication is always a challenge for me since I don’t live there.
The UK continues to be an evolving market, with recent changes to financial regulatory requirements aimed at tackling privacy and security issues. Specifically, new data regulation (such as GDPR and PSD2 legislation) will have a wide-ranging impact on the way businesses handle customer data.
Each market has their unique headwinds to counter. It’s with this in mind that we designed our product at Emailage from the ground to to be a global, enterprise solution—a single integration that can be can leveraged everywhere.
Throughout all these countries I visited, the main common denominator is that the email address is very powerful when it comes to assessing risk and verifying consumer identity. Especially in countries where it’s not very easy to collect any type of PII, we are still able to provide strong results without friction on the customer side. That’s because the email address is the best global identifier which allows companies to perform robust risk assessment, even in the absence of other data elements.
No matter the region, fraudsters are bolder than ever. We must use all the tools at our disposal to fight back.
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