Mobile Fraud Alerts- Improve Customer Service and Fraud Operations - a podcast by ACI Worldwide

Today we're going to give you some background on Spectrum and ACI's relationship with Spectrum. We're going to talk a little bit about the market insight on how mobile alerting affects consumer relationships with their banks and issuers. We're going to cover some practical applications of ACI mobile alerting with the various ACI solutions, and we're going to cover off some real world examples of how global institutions have successfully deployed the solutions and some results related. At the end we'll spend some time for some Q&A. 

So, first up, I wanted to spend a moment to talk a little bit about Spectrum Message Services. Specializing in flow-driven financial and telecom traffic, they are a technology company that offers several solutions including MoneyGuard SMS and Mobile payments platform, their Technocall IVR and Call Centre solution, and Floware SOA business process management solution. ACI mobile alerting solution is powered by their MoneyGuard solution. 

Spectrum has been around for ten years. They originally started in Hungary in 1993, and now also have offices in Australia. The relationship between Spectrum and ACI dates back to 1999 when Spectrum first integrated its MoneyGuard mobile alerting solution on the Base24 payments platform at OTP Bank in Hungary. 

We then also started working with them on our payments risk management solution, Proactive Risk Manager, in 2006 at that same entity. In 2008 we entered a formal partnership with them in the Amir region, and then expanded that to include offerings in the Americas and Asia Pacific as well. 

I'm going to move on to a little bit of market information related to mobile alerting from a fraud and consumer service perspective. Last year, ACI embarked on a third global card fraud study. We surveyed 5,200 consumers in 17 countries around the world. We teamed with U.S.-based analyst research firm, AITE, to interpret and report on the findings, and publish a formal report. 

The result is a comprehensive picture of consumer attitudes and experiences with credit, debit, and other forms of card fraud. We conducted the survey last year to help our banking and retail clients better understand what consumers think about fraud, their experiences with fraud, and to help them understand the impact fraud has on existing and future relationships with the financial institutions. 

So, the survey includes some key findings. 27% experienced card fraud in the last five years, so just a little more than one in four experiencing card fraud. 82% said that they were very interested in being notified prior to the bank taking action. But we'll get into that a little bit more in the next couple of slides. 74% prefer that no additional transactions are posted until they respond to a fraud alert, and 21% of cardholders said that they would leave their institution after experiencing fraud. 

So, if you kind of look at that at a high level what does that mean? Fraud is being experienced by many of your customers. The majority of them want to be informed and want real-time action to be taken based on their instructions, and 20% of the customer base could leave as a result of fraud. So that's not an insignificant number. 

As we look at some of the credit card fraud rates by country, you'll see the 17 countries that were included in the survey broken out here. The U.S. and Mexico lead the way and have been the unfortunate benefactors of fraud, as we are the last back end to roll out EMV and still employing the signature versus more secure PIN verification methodology. 

But even in some of the EMV countries like the UK, almost a third of consumers surveyed experienced some form of credit card fraud in the past five years. As you can see, also on the other end of the spectrum, Holland enjoys very low card rates at less than 10% as do Germany and Sweden hovering right around the same area. 

When we look at the debit card fraud rates by country, the rates are a little bit lower in general. That's largely influenced by the nature of PIN transactions associated with a debit card.

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